The aggregate capitalization of the cryptocurrency market has fallen below the $1 trillion level, according to CoinMarketCap.
At the time of writing, the figure is at $983 billion. Meanwhile, on CoinGecko, the capitalization is still above $1 trillion and is showing growth of 1.6% over the last 24 hours.
Bitcoin is currently holding near $21,420 and Ethereum is above $1460.
Earlier, analysts at Blofin noted that the U.S. stock market declined slightly, while the decline in cryptocurrencies has paused.
“However, the next shock from the Fed’s rate hike in July is not far off,” Blofin added.
1/9. The U.S stock market fell to some extent today, whereas the crypto market stopped its losses. However, the next shock brought by the arrival of the Fed's interest rate hike in July is upcoming. pic.twitter.com/4AGIMaRspC
— Blofin (@Blofin_Official) July 27, 2022
Analysts also pointed to the Fear and Greed Index. In their view, bearish sentiment in the digital asset market is “relatively stable.
The Fed is expected to raise its key rate by 75 bps to 2.25-2.5% at the next meeting. The indicator is now at 1.5-1.75%.
In March 2022, the Fed raised its key rate for the first time since December 2018 by 25 bps, to 0.25-0.5%. Bitcoin and the S&P 500 rose then.
In May, the Fed raised its key rate range to 0.75-1% per annum, which surprised markets. Against this backdrop, the price of the first cryptocurrency momentarily surpassed the $40,000 level, but fell below $36,000 on the same day, which was the beginning of a prolonged correction.
In June, the Federal Reserve sharply raised its key rate by 75 bps, to 1.5-1.75%. Bitcoin, which had earlier failed at the $30,000 level on news of accelerating annual inflation, responded by rising.
Recall that the head of Galaxy Digital Mike Novogratz assumed that the recession in the cryptocurrency market will last about 18 months. In his opinion, the industry will see the first signs of recovery after the Federal Reserve softened monetary policy.
Investor Michael Buehry, who predicted the mortgage crisis of 2007, predicted that bitcoin prices would continue to fall.
