The cryptocurrency market traded in the deep red on Thursday after the US Federal Reserve commentary added to doubts over early rate cuts.

The Federal Reserve committee’s decision to hold rates at 5.25-5.5% on Wednesday was no surprise, it took a dovish twist by emphasising that rates would not be cut until it had more confidence that inflation was truly beaten.

In a media conference, Fed Chair Jerome Powell flatly stated a cut as early as March seemed unlikely, but also conceded that everyone on the committee was looking to ease this year.

Meanwhile, the global cryptocurrency market cap declined 2.5% to around $1.69 trillion in the last 24 hours, as per data available on CoinGecko.

At 10.16 a.m., Bitcoin was trading 2% lower at $42,093, while Ethereum was down 3.2% at $2,264. Another popular altcoin such as Solana and Avalanche fell over 5% each. While BNB, XRP, Cardano, Donecoin, Chainlink, Polygon, and Shiba Inu also declined by 1-3%.Following the US Federal Reserve’s decision to maintain interest rates, Bitcoin slipped below the $43,000 mark as investors anticipated a potential rate cut in March, said Edul Patel, CEO of Mudrex.Shivam Thakral, CEO of BuyUcoin, said, “The Altcoin market also took a downturn which could change unless Ethereum breaches $2500 amid other positive macroeconomic factors.”The total volume in DeFi is currently $5.91 billion, 14.36% of the total crypto market 24-hour volume. The volume of all stablecoins is now $14.53 billion, which is 35.31% of the total crypto market 24-hour volume, as per data available on CoinMarketCap.

In the last 24 hours, the market cap of Bitcoin, the world’s largest cryptocurrency, dropped to $824 billion. Bitcoin’s dominance is currently 54.42%, according to CoinMarketCap. BTC volume in the last 24 hours surged 12.7% to $25.73 billion.

“Bitcoin’s recent drop below $43,000 followed a hawkish stance by Federal Reserve Chairman Jerome Powell, suggesting a March rate cut is unlikely. However, the broader economic environment favors Bitcoin in 2024 with expectations of a possible Fed rate cut, which traditionally boosts cryptocurrencies,” said Sathvik Vishwanath, Co-Founder & CEO, Unocoin.

“Additionally, expectations surrounding the April halving of Bitcoin and potential supportive US political and fiscal dynamics add to the bullish outlook. Despite the near-term uncertainty, Bitcoin’s price trajectory is set for a potential rally to the low $50,000s, outweighing the prospect of a dip to the low $30,000s in the foreseeable future,” Sathvik added.

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