Bitcoin fell below $25,000 on Thursday, as monetary policy adds to pressure from regulators. Central bankers held interest rates steady but signaled more rate hikes to come. Crypto markets have been reeling from SEC lawsuits targeting Binance and Coinbase. Loading Something is loading.
Thanks for signing up!
Access your favorite topics in a personalized feed while you’re on the go.
Bitcoin fell below $25,000 early on Thursday, as digital assets take a hit from an aggressive crackdown by US regulators and hawkish signals from the Federal Reserve.
The world’s biggest cryptocurrency by market value traded lower to $24,897 on Thursday morning, down around 4% from $25,930 on Wednesday. Ethereum, meanwhile, fell to $1,636, down nearly 6% from Wednesday’s levels.
The slump came shortly after the Fed kept interest rates steady at the conclusion of its two-day policy meeting, but signaled that more interest rate hikes could come later this year as central bankers continue to wage war against inflation.
The central bank’s dot-plot of projected rate moves and Chairman Jerome Powell’s “hawkish pause” spooked traders, who had been thinking going into the meeting that the Fed could be about to signal its rate-hike campaign was over.
Markets are currently pricing in a 65% chance that the Fed will raise rates another 25 basis-points in July.
Tighter monetary policy is adding to pressures being exerted by regulators, with bitcoin and ethereum prices stumbling as the Securities and Exchange Commission looks to police the sector more tightly.
Binance and Coinbase were sued this month by the SEC. The regulator’s complaint states that both firms are operating illegally in the US and that they have broken rules by offering their customers unregulated securities.
The suits are part of the SEC’s siege against the wider crypto industry, Binance said in a statement last week while denying the allegations. Experts told Insider that the lawsuits could set a precedent for how crypto firms are treated in the US, potentially leading to an existential crisis for the crypto industry at large.