Bitcoin Defies Gravity: Grayscale's Bold Prediction Amid Rate Increase Fears

Zinger Key Points
  • Grayscale analyzes Bitcoin's volatility amid market uncertainty.
  • Crypto investors' appetites remains strong during economic turmoil.

As the price of Bitcoin BTC/USD experiences fluctuations ahead of the U.S. Federal Reserve's upcoming interest rate decision on Wednesday, Grayscale has suggested cryptocurrency prices could still benefit from a rate increase, provided that the outcome aligns with market expectations.

Bitcoin's price dropped 4.3% on Monday and is currently trading around $27,990, according to TradingView data. The crypto recovered from the day's lows after MicroStrategy reported its results and reaffirmed its strong conviction in its Bitcoin strategy.

Despite falling approximately 1.8% over the past month, the world's largest cryptocurrency by market capitalization is still up 69% year-to-date.

The Fed is expected to raise rates by 25 basis points, as indicated by CME's FedWatch tool.

Grayscale analyzed Bitcoin's volatility, highlighting the turbulence witnessed in the second half of April, and emphasized several key takeaways.

Also Read: 'Intercompany Chaos': Bankrupt Crypto Lender Celsius' UK, US Entities A Facade?

The firm noted, "Bitcoin may still be susceptible to a number of sentiment-driven factors that can be influenced by incorrect or incomplete information," citing a misleading Arkham alert as an example.

Grayscale also mentioned that the perceived actions of large holders can significantly impact Bitcoin's value.

Nevertheless, Grayscale maintained factors such as an additional rate hike and declining inflation "align well with a bullish case for Bitcoin in the future."

The company also points out that the failures of several regional banks demonstrate "investors continue to display an appetite for crypto during times of economic uncertainty."

Read Next: Bitcoin's BRC-20 Token Explosion: Market Cap Skyrockets 682% In Just One Week

Photo: Shutterstock

Market News and Data brought to you by Benzinga APIs
Comments
Loading...
Posted In: CryptocurrencyNewsFederal ReserveMarketsCMECrypto pricesExpert IdeasFedWatch ToolGrayscaleInterest Rates
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!