Bitcoin price stabilizes after Fed-fueled drop
Bitcoin stabilized after a drop of 2% over a 24 hour period, falling below $58,000 per coin.
Crypto demand continues to rise as more celebrities want to be paid in Bitcoin
FOX Business Kelly O’Grady talks Bitcoin's increasing popularity as celebrities, athletes, and politicians choose to take paychecks in Bitcoin.
Bitcoin was trading more than 0.3% higher Wednesday morning.
Ethereum was also showing gains.
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Bitcoin fell on Tuesday after U.S. Federal Reserve Chair Jerome Powell warned that the risk of higher inflation has "increased."
Bitcoin fell 2% over a 24 hour period, falling below $58,000 per coin.
Powell told Congress the central bank may halt the billions of dollars of bond purchases it’s making every month "perhaps a few months sooner." It had been on pace to wrap up the purchases, meant to goose the economy by lowering rates for mortgages and other long-term loans, in June.
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An end to the purchases would open the door for the Fed to raise short-term interest rates from their record low of nearly zero.
"A faster Fed taper and increased rate hike expectations was bad news for bitcoin," Edward Moya, senior market analyst at foreign-exchange broker Oanda, wrote in a market commentary.
"Bitcoin is trading more like a risky asset than an inflation hedge," Coindesk reported.
Ether, the second-largest cryptocurrency by market capitalization, ended Tuesday with its fourth straight day of gains, trading above $4,600, according to CoinDesk’s data.
In other news, cryptocurrency products and funds have had a strong 11 months, according to Reuters. They've posted record inflows, as institutional investors flocked into the space despite price declines in the last few weeks, according to data from digital asset manager CoinShares.
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Total inflows into the sector were $9.5 billion as of Nov. 26, an all-time high. In 2020, total bitcoin inflows were $6.7 billion.
On the week, inflows reached $306 million.