When will Cryptocurrency go up after Fed rate hike?

When will Cryptocurrency go up after Fed rate hike?
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When will Cryptocurrency go up after Fed rate hike?This is what happened between 2017 and 2020

May 6th

The Fed announced a rate hike on May 4th, 2022

On-Chain College on Twitter: “$165 million in #Bitcoin Long Liquidations today.This is the highest daily long liquidation amount since the end of January 2022 crash. pic.twitter.com/vwfp0ZzQNb / Twitter”

165 million in #Bitcoin Long Liquidations today.This is the highest daily long liquidation amount since the end of January 2022 crash. pic.twitter.com/vwfp0ZzQNb

When will cryptocurrency go up? The 2017-18 Crash

In Sept 2017, The Federal Reserve announced that it would begin reducing the size of its balance sheet, a process that continued until early 2019

Will cryptocurrency crash after Fed rate hike?

During this period, this is what happened

  • First 3 months, Bitcoin went from $ 3000 to $ 18000
  • Next 13 months, crashed to$ 3000
  • Next 12 months, increased 3 fold
  • Next 18 months, 3 fold again
When will Cryptocurrency go up after Fed rate hike?

The Crypto market was much smaller then, about 5-10% of its current size, in the range of $ 100 Billion, Bitcoin alone was at $ 65 Billion. US Household wealth was about 92 Trillion then. By the second quarter of 2019, US Household Wealth increased to 114 Trillion.

So what we know from 2017 to 2019 that Bitcoin prices had doubled while US household wealth increased by nearly 24%.

US Household wealth is about a 150 Trillion now. Not to forget that Cryptocurrency is traded globally. The Global wealth which was about $ 280 Trillion in 2017 is now more than $ 400 Trillion.

The Cryptocurrency market is worth about 2 Trillion now. In the context of both Domestic and Global wealth, its share is less than 1%.

So here is a summary

  • The last time the Fed reduced the size of its balance sheet, prices doubled in an 18 month period
  • While it is likely the pace of growth of Global wealth will slow down, the share of Cryptocurrency is less than 1% of Global wealth. So there is substantial room for expansion
  • Cryptocurrency continues to make it to the Portfolios of wealthy and middle class Households Globally. There are numerous published surveys around this.

When will cryptocurrency go up? Should I buy any Cryptocurrency now?

Now, will History repeat itself? Time will tell. But what we know should make us feel confident about what may happen next. That said, the usual discussions around the Utility of Cryptocurrencies will continue to remain and have a bearing on Prices and Valuations, so one cannot ignore that too.

The Trade is yours now to make. Buy or Sell?

Note: Crowdwisdom360 collates Predictions and data from all over the net and has no in-house view on the likely trends in Stocks or Coins. Please consult a registered investment advisor to guide you on your financial decisions. 

Read our Coverage of the Cryptocurrency and Stock Market here

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