What role do interest rates set by the Feds play in the volatility of the cryptocurrency market?

1 answers

• Soham SahaJun 30, 2025 · 2 months ago
  Interest rates set by the Federal Reserve can have a significant impact on the volatility of the cryptocurrency market. When the Federal Reserve raises interest rates, it can make borrowing more expensive, which can lead to a decrease in investment and a decrease in demand for cryptocurrencies. This can result in a decrease in cryptocurrency prices and increased volatility. Conversely, when the Federal Reserve lowers interest rates, it can make borrowing cheaper, which can lead to an increase in investment and an increase in demand for cryptocurrencies. This can result in an increase in cryptocurrency prices and increased volatility. Therefore, the interest rates set by the Feds can play a crucial role in shaping the volatility of the cryptocurrency market.
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