Bitcoin Dips to $43K, Ethereum Sheds 8%, Here Could Be the Cause of the Selloff and What Analysts Say

The cryptocurrency market succumbed to widespread selling pressure as Bitcoin and altcoins pared off the gains accumulated in the previous days. Bitcoin price slid to lows of $43,086 while Ethereum dropped 8% to $3,172 before a slight rebound.

The majority of the crypto assets, especially in the top 100 are trading presently in red with some recording significant losses. Binance Coin (BNB), Solana (SOL), Cardano (ADA), and XRP (XRP) have all experienced severe corrections between -7% to -11% in the past 24 hours.

Altcoins suffered a bigger hit as bitcoin dipped nearly 5% to trade at $43,925 at press time. Speaking on the altcoin market dip, OnChain Analytics Santiment says ”A significant portion of altcoins has retraced by double-digit percentages the past 24 hours. And there appears to be a declining interest in them as a result, as traders move funds back into Bitcoin to mitigate volatility”

The latest bitcoin move defied positive triggers in the form of fresh buy-ins from MicroStrategy and Terra, but analysts were instead eyeing macro factors as the next potential BTC price booster.

Here Could Be the Cause of the Selloff and What Analysts Say

US treasury yields jumped by nearly 2.56% largely due to Brainard’s hawkish remarks, which raised fears ahead of FOMC minutes on Wed. Fed Governor Lael Brainard said on Tuesday that the central bank might begin shrinking its balance sheet as early as May and that it would do so at a “rapid pace.”Stocks are down for a second day, with the Nasdaq dropping another 2% as the Federal Reserve announces policy tightening intentions.

The release of the Fed’s meeting minutes on Wednesday afternoon revealed that officials “largely agreed” that the balance sheet should be shrunk by $95 billion per month. The minutes also revealed that central bank policymakers were mulling higher rate hikes than the customary quarter-point increments of 25 basis points. Following the release of the minutes, stocks fell to session lows before recovering somewhat to finish the day.

President Patrick Harker of the Philadelphia Federal Reserve said earlier Wednesday that rising inflation is “acutely concerning,” and that he expects “a series of deliberate, methodical hikes as the year progresses and the data evolve.” His remarks come less than a day after Brainard expressed support for higher interest rates and suggested that the central bank’s balance sheet could be reduced “rapidly” as early as May. Stocks fell in the prior session as a result of the comments.

Veteran trader Peter Brandt recently tweeted that the next raging Bitcoin bull market might begin in May 2024. After the end of previous large increases, it took an average of 33 months for Bitcoin to begin another bullish phase, according to the chartist. Brandt expects the largest cryptocurrency to recreate its past boom-and-bust cycles despite how unpredictable its price seemingly is.

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