Crypto turns red as Fed Chair Jerome Powell hints at higher rates

  • Crypto and stocks reacted negatively to comments about US inflation by Fed Chair Jerome Powell.
  • Bitcoin traded to lows of $22,120 while the S&P 500 fell 1%.
  • Investors are now likely to turn their attention to the next Fed meeting in March.

Cryptocurrencies fell early Tuesday, with Bitcoin trading towards support around $22,100 on broader market reaction to comments from Federal Reserve Chair Jerome Powell.

Coin360 crypto map showing price dump after Powell’s remarks. Source: Coin360

The reaction also saw US stocks slip after Monday’s gains, with investors appearing to have been spooked by Powell’s remarks on interest rates.

Crypto, stocks fall on Fed Chair remarks

Powell was on Tuesday making his first of two appearances before US Congress – first at the Senate Banking Committee and on the second day, at the House Financial Services Committee. The central bank’s monetary policy, particularly on inflation, is a key element of the Fed Chair’s prepared testimony.

Notably, Powell told lawmakers that it is possible the Fed will look to raise interest rates further given recent economic data that came in hotter than expected. According to the Fed, these sets of economic metrics suggest interest rates could still go up. This, he noted, will be warranted if outlook indicated there’s need for faster tightening.

Following the news, crypto, stocks and bonds reacted lower as the dollar index rose. Bitcoin touched 24-hour lows of $22,120, while Ethereum fell to support near $1,540. Across the stock market, the S&P 500 dropped by 1%, while the Dow Jones Industrial Average and the Nasdaq Composite shed 0.6% and 0.9% respectively.

Economist Mohamed El-Erian pointed out the market’s reaction and what Powell’s testimony projects.


While markets might see a swift bounce from the losses, investors are likely to remain jittery ahead of the Fed’s next policy announcement expected on 22 March, 2023. 

All Dutch and English crypto news!

‘Biased, deceptive’: Center for AI accuses ChatGPT creator of violating trade laws

The Center for Artificial Intelligence and Digital Policy (CAIDP) has filed a complaint with the United States Federal Trade Commission (FTC) in an attempt to...

DAO treasuries top $25 billion for the first time: DeepDAO

Decentralized autonomous organization (DAO) treasuries are rapidly growing having just surpassed a major milestone, according to DeepDAO. According to figures from the DAO data platform, on...

Polls suggest Elizabeth Warren’s anti-crypto army strategy may not pay off

The United States Senator for Massachusetts Elizabeth Warren is making her "anti-crypto" agenda one of the centerpieces of her re-election campaign, despite polls suggesting the...

‘Killer use case’: Citi says trillions in assets could be tokenized by 2030

Investment bank Citi is betting on the blockchain-based tokenization of real-world assets to become the next "killer use case" in crypto, with the firm forecasting...

Beste exchanges

Koop je crypto bij Bitvavo