What is the correlation between the Fed funds target rate and the value of cryptocurrencies?

3 answers

• Nov 24, 2021 · 3 years ago
  The correlation between the Fed funds target rate and the value of cryptocurrencies is complex. Generally, when the Fed raises interest rates, it can lead to a decrease in the value of cryptocurrencies. This is because higher interest rates make traditional investments more attractive, reducing the demand for cryptocurrencies. However, the impact may vary depending on other factors such as market sentiment and overall economic conditions.
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• Nov 24, 2021 · 3 years ago
  The Fed funds target rate and the value of cryptocurrencies are not directly correlated. Cryptocurrencies are decentralized and influenced by various factors such as market demand, technological advancements, and regulatory developments. While changes in the Fed funds rate can indirectly affect investor sentiment and market conditions, it is not the sole determinant of cryptocurrency prices.
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• Nov 24, 2021 · 3 years ago
  According to BYDFi, a leading cryptocurrency exchange, the Fed funds target rate can have an impact on the value of cryptocurrencies. When the Fed raises interest rates, it can lead to a decrease in the value of cryptocurrencies. However, it's important to note that the correlation is not always straightforward and can be influenced by other factors such as market trends and investor sentiment. It's advisable to consider a holistic view of the cryptocurrency market when analyzing its relationship with the Fed funds rate.
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