Bitcoin price falls as ‘sugar rush' from Miami Crypto event fades
Bitcoin price briefly dropped below $42,000 for the first time since March 23, sliding back further into the range in which it has traded this year on mounting concerns about rising interest rates.
The largest cryptocurrency fell as low as $41,918 on Monday morning in Asia, retreating for the seventh day in the past eight. Since peaking at just above $48,000 in late March, Bitcoin -- and other tokens -- have been dragged lower by concerns about tighter monetary policy. Even the buzz around last week’s Bitcoin 2022 conference in Miami wasn’t enough to reverse the trend.
U.S. inflation likely accelerated to 8.4% in March, the fastest pace since early 1982, economists surveyed ahead of data due Tuesday predict. The Federal Reserve may need to hike interest rates above 4%, Goldman Sachs Group Inc. Chief Economist Jan Hatzius said Friday.
Expectations for tighter monetary policy has hurt demand for riskier assets such as cryptocurrencies and tech stocks, which are increasingly moving in tandem.
“Now the sugar rush of Bitcoin 2022 has passed, Tuesday’s (likely) ugly U.S. consumer price report is a reminder that the Fed is caught between a rock and a hard place when it comes to tackling runaway inflation without sinking the economy,” said Antoni Trenchev, managing partner of crypto lender Nexo, in emailed comments.
Bitcoin also briefly dipped below its 50-day moving average. The token traded at $42,270 at 9:40 a.m. in Hong Kong, down about 2% for the day. Ether slipped 2.8% to $3,196. Equities were mixed, the Chinese markets down sharply while Australian and Japanese stocks were little changed.
Bitcoin has been in a trading range of around $35,000 to $45,000 for much of the year so far. The breakout above $48,000 last month
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