NEW YORK – The value of bitcoin fell further on Wednesday to below $60,000. The world’s best-known and largest cryptocurrency already had its worst month in April since the collapse of the crypto exchange FTX in November 2022. The price drop is partly caused by the prospect that American interest rates will remain high for longer.
Investors in digital currencies hoped that inflation in the world’s largest economy would have cooled sufficiently and that the Federal Reserve would cut interest rates this spring. However, the US central bank, which will meet later in the day to discuss interest rate policy, has already announced that inflation is still too high to lower interest rates. A first interest rate cut is now only expected in September. Higher interest rates are generally negative for investments in digital coins, which do not earn interest.
Bitcoin was trading at $59,755 on Wednesday morning. In the past month, the currency has lost almost 16 percent of its value. Strong demand among investors for American listed bitcoin funds, which were introduced at the beginning of this year, previously led to a strong revival of the currency.
Partly thanks to the strong inflow of capital into these bitcoin ETFs, the coin rose to a record level of almost $ 74,000 in March. According to data from Bloomberg news agency, investors withdrew about $182 million from these funds in April. In March, $4.6 billion in new capital was invested in bitcoin ETFs. Investors also appear to be taking some profits. The value of bitcoin has still risen by almost 40 percent this year.
