Australian shares to fall as Wall Street drops on interest rate angst
Bitcoin pulled back from its highest price level since June and smaller cryptocurrencies slumped after the Federal Reserve’s interest-rate increase eased speculation that looser monetary policy would fuel demand for digital assets.
Other tokens associated with crypto entrepreneur Justin Sun dropped sharply after the US Securities and Exchange Commission charged him and three of his companies with offering and selling unregistered securities, as well as price manipulation.
TRX, the token associated with the Tron network that Sun started, dropped 10 per cent in the last hour, according to tracker CoinMarketCap. The price of BTT, a token associated with BitTorrent, fell by more than 1 per cent.
Bitcoin fell 5 per cent to $US26,753 as of 4pm in New York, after climbing to as high as $US28,913 earlier. The cryptocurrency flirted with breaching $US29,000 for the first time since June. Bitcoin has rallied about 60 per cent this year. That comes on the back of last year’s 64 per cent decline.
“Wow, the market is reacting violently to the latest hike,” said Kevin March, founder of crypto prime brokerage platform Floating Point Group. There was a “huge volatility and volume spike as investors realise that there’s nothing stopping the Fed from continuing to hike rates if the affected mid-sized lenders are going to keep getting bailed out.”
Crypto prices have surged anew in recent weeks amid turmoil in the US and European financials sector, to which three US banks have succumbed and which brought about the takeover of Credit Suisse Group by UBS Group over the weekend. Digital-asset proponents say that their industry is a beneficiary as investors realise that tokens are out of the reach of governments and are far removed from any of the issues occurring with different lenders.