According to Xinhua News Agency, major cryptocurrencies, including Bitcoin, experienced significant declines on Jan. 31, driven by market expectations of a more hawkish monetary policy stance from the U.S. Federal Reserve. Data from the U.S.-based cryptocurrency exchange Kraken showed that Bitcoin's price fell to US$77,082.48 at one point in the afternoon, marking a maximum drop of 8.32% over the past 24 hours. Ethereum's price dropped to US$2,354.67, with a maximum decline of 12.84% during the same period. Data also indicated sharp falls in the prices of other tokens such as Solana, Dogecoin, and Binance Coin.
Analysts attribute the sell-off to U.S. President Donald Trump's announcement on Jan. 30, nominating former Federal Reserve Governor Kevin Warsh as the next Chair of the Federal Reserve. This has heightened market expectations of a hawkish shift in the Fed's future monetary policy, leading to a significant strengthening of the U.S. dollar and a sharp correction in precious metal prices. High-risk, high-volatility cryptocurrencies have also faced selling pressure.
Markus Thielen, founder of Singapore-based research firm 10x Research, noted that expectations of Warsh's hawkish policy stance have shifted the perception of cryptocurrencies: they are no longer seen as a "hedge against currency devaluation" but rather as "speculative excess assets." Once accommodative monetary policies come to an end, the speculative rally in such assets tends to fade.
Related News:
Comment