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Bitcoin Is Struggling to Break Through $47,500 as a Fed Meeting Approaches
Bitcoin, the world’s largest cryptocurrency by market capitalization, was down as the market prepared for the Federal Reserve’s monetary policy meeting this week, where the US central bank is likely to shut down its money printer.
The Fed is likely to announce plans to reduce the pace of its $120 billion-per-month asset purchases by $30 billion per month, or twice the current rate of decrease, at the end of the two-day meeting, which begins Tuesday and finishes Wednesday. According to some cryptocurrency traders and investors, the stimulus program has increased bitcoin’s attractiveness as an inflation hedge, so a reversal of the loose-money policy might be unfavorable.
Bitcoin, which tends to fluctuate in sync with traditional markets, began the month of December around $57,000 and is now trading about $46,600. The cryptocurrency has dropped by more than 30% from its all-time high in November.
Why is bitcoin down?
Lennard Neo, head of research at Stack Funds, blamed the cryptocurrency’s recent decrease to market uncertainty, which caused investors to reduce their risk exposure. Some investors regard Bitcoin as a risk-on asset, which often refers to assets with high price volatility, such as industrial metals, stocks, and…
