• The Federal Reserve predicted lower inflation for 2023 and this caused the price of bitcoin to rise.
• Bitcoin experienced its worst year in 2022, dropping from an all-time high of $68,000 to below $17,000.
• After a recent bullish period, bitcoin has added about $7,000 to its price over the last few weeks.
Federal Reserve Predicts Lower Inflation
The Federal Reserve recently announced that they are expecting decreased inflation for 2023. This announcement caused the price of bitcoin to go up significantly. Jerome Powell, the Federal Reserve chair stated in an interview that it will take until at least 2024 to get back down close to two percent inflation rate. He also warned of more rate hikes in the coming months which could mean people won’t be able to enjoy their American dreams as much as they had hoped due to an inability to pay interest on items such as houses and cars.
Bitcoin Experiences Worst Year on Record in 2022
Prior to 2022, bitcoin reached an all-time high of $68,000 per unit but then dropped into the high $40,000 range within eight weeks which resulted in a loss of about $20K for investors. By the end of 2022 it was trading at around $16,600 – more than 70 percent below its all-time high – causing other forms of crypto and the entire crypto industry as a whole (valued at over $3 trillion 11 months prior) to fall below one trillion dollars total value.
Recent Bullish Period Gives Hope For Recovery
However after this dismal year Bitcoin has been experiencing something of a bullish period with its current price adding about 7 thousand dollars over the last few weeks giving investors hope that 2022 can officially be put in the past where it belongs and recovery is possible.
Rate Hikes May Affect People’s Dreams
Powell also stated that there may be increased rate hikes which could make it harder for individuals to purchase big ticket items such as houses and cars due to difficulty paying interest rates on them – thus making achieving their American dreams more difficult than anticipated if rate hikes continue throughout 2023-2024.
Increased Optimism For Crypto Industry
Despite this potentially gloomy outlook many investors seem optimistic about cryptocurrency’s future with Bitcoin currently rising above what it was trading at before its fall in 2021 giving hope that a full recovery is possible if trends continue throughout 2023-2024.