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@bankbank55
How a Decrease in Interest Rates Affects the Cryptocurrency Market: Lessons from 2020 and 2022 A few days ago, the Federal Reserve (Fed) reduced its key interest rate by 50 basis points, setting a range of 4.75%–5%. This marked the first rate cut in over four years, signaling a shift aimed at supporting economic growth and preventing rising unemployment. The stock market’s reaction to these sharp changes underscored the sensitivity of the relationship between interest rates and stock valuations. The Fed’s interest rate cuts have a significant impact not only on traditional financial markets but also on the cryptocurrency market. In periods when the Fed lowers rates to stimulate the economy, this brings about changes that investors may view positively. Let’s examine how the rate cuts affected the crypto market in 2020 and 2022, and what lessons can be drawn for future changes.
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