The Federal Reserve’s decision to raise interest rates in an effort to rein in spiraling inflation has resulted in a significant drop in the value of Bitcoin.
For the last two weeks, Bitcoin prices have been on a downward trend. Bitcoin was worth more than Rs 38 lakh on December 23, 2021, according to statistics from investing.com. At Rs 31.8 lakhs on January 7, 2022, the price of one Bitcoin had dropped by Rs 7 lakhs from only 15 days before. Two months ago, on November 8, 2021, the digital asset’s price was around Rs 50 lakhs. The price of Bitcoin plummeted substantially on foreign markets and was now $42.8K.
What Is Causing the Rapid Decline in Bitcoin Prices?
Predatory Stance monetary policy of the Federal Reserve
Inflation has risen rapidly in the United States during the last several weeks. According to media sources, the county had its greatest inflation rate in 39 years. The Federal Reserve has just announced that it intends to boost interest rates in an effort to keep prices from rising any more.
According to Business Insider, interest rates have been inversely related to the price of Bitcoin. A rise in bond rates has pushed investors away from digital currencies and toward government bonds. This has had a significant impact on Bitcoin SV recent price decline.
Cryptocurrency legislation has been passed by India’s parliament.
Cryptocurrency regulation or outright prohibition is nearing finalisation in India’s legislature. Details of the law have not been made public, although media sources have indicated that it might be one of these two options. With so many individuals selling their digital currencies as a result, the market value of Bitcoin and the others has dropped precipitously in recent days.
Cryptocurrency and official digital currency legislation planned to be submitted in Parliament’s Winter Session in 2021, according to the bill’s title. However, it was postponed for a variety of reasons. On December 22, Bitcoin was trading for much over Rs 38 lakhs, just before the winter session began. Nearly 32 lakhs have been lost since then..