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2022: Sharp Reversal and Crypto Market Reaction 📉
In 2022, the Fed shifted its monetary policy, aggressively raising interest rates to combat rising inflation. After a period of low rates, inflation began to surge, and central banks, including the Fed, started increasing rates to curb price growth. This sharp reversal had significant consequences for the cryptocurrency market.

The rapid rate hikes in 2022 led to a "bear market" for cryptocurrencies. Bitcoin and other cryptocurrencies saw substantial declines as investors pulled funds from risky assets like crypto and returned to safer investments. Higher interest rates made borrowing more expensive, negatively affecting market liquidity. Moreover, with rising yields on traditional financial assets, such as bonds, cryptocurrencies lost some of their appeal.