What kind of a direction can the recent developments on a global scale lead to the crypto money market?
The coronavirus, which emerged in China in 2019 and spread to all corners of the world in 2020, triggered a global-scale inflation by causing the rise of consumer price indices. High rates of value increases were recorded in commodity and crypto asset prices as investors turned to assets with limited supply in an inflationary environment.
Interest Decisions of Central Banks
Many central banks on a global scale announced their new interest rate decisions this week. While many central banks, including the FED , announced that they kept interest rates constant, the Bank of England increased interest rates. With the announcement of the highest inflation figure in the USA since 1980 and the FED’s interest rate decision, Bitcoin gained an upward momentum. Bitcoin, which was traded at the price levels of $ 46,000, rose to the price levels of $ 48,700 in a short time. Although Bitcoin has not yet been able to maintain its value increases, the inflationary environment in the USA has created a rise expectation in the market.
Could the Omicron Variant Trigger the Ascension?
The leading cryptocurrency , Bitcoin, which has experienced high depreciation in recent months , has dropped to $ 42,000 price levels, albeit for a short time, since the ATH level of $ 69,000 it recorded. With its latest price movements, Bitcoin started to be traded at the price levels of $ 47,100. Ethereum, the second largest crypto asset in terms of market capitalization, also lost value at high rates in parallel with Bitcoin. With the recent downward price movements, Ethereum started to trade at the price levels of $ 3,800, losing the support level at the $ 4,000 price band.
Here, many crypto analysts drew attention to the Omicron variant from their social media accounts and stated that an upward wave in cryptocurrencies could be triggered as in 2020. Drawing attention to the inflationary environment on a global scale, analysts expressed the value increases recorded in commodities and crypto assets in 2020.
Of course, price movements in the market may not always be in the same direction as investors’ expectations in the short term. However, the increase in inflation rates in many countries of the world, especially in the USA, greatly increased the demand for assets with limited supply.
The information contained in this article does not constitute investment advice. Investors should know that cryptocurrencies carry risks due to their high volatility and should perform their transactions in line with their own research.