[Bitcoin Now] Decline Amid US Stock Market Drop... Battle Around $20,000 Level

[Image source=Reuters Yonhap News]

[Asia Economy Reporter Myunghwan Lee] The price of Bitcoin, the representative cryptocurrency, is showing a downward trend influenced by the decline in the U.S. stock market, fluctuating around the $20,000 level.

According to the global cryptocurrency market tracking site CoinMarketCap, as of 10:45 a.m. on the 7th, the price of Bitcoin was recorded at $20,600 (approximately 28.25 million KRW), down 1.32% from the previous day.

The Bitcoin price appears to be affected by the decline in the U.S. stock market, which shows a synchronization phenomenon. On the 6th (local time), the Nasdaq index, focused on technology stocks, closed at 11,073.31, down 0.68% (75.33 points) from the previous trading day on the New York Stock Exchange. The Dow Jones Industrial Average fell 1.15% (346.93 points) to 29,926.94, and the S&P 500 index retreated 1.02% (38.76 points) to close at 3,744.52.

The Federal Reserve (Fed) officials' reiterated commitment to raising the benchmark interest rate also seems to have influenced risk asset preference sentiment. Neel Kashkari, President of the Minneapolis Federal Reserve Bank, said at a conference held in Minnesota that day, "I see little evidence that core inflation is coming down," implying that it is too early for the Fed to stop raising interest rates. Fed Governor Lisa Cook also argued in her speech that "high inflation is lasting longer than expected, which provides strong grounds for the Fed to keep rates elevated until the economy slows down after rate hikes."

Major altcoins are also on the decline. At the same time, Ethereum was down 1.12% from the previous day to $1,356 (approximately 1.9161 million KRW), and Solana was down 2.04% to $33.50 (approximately 47,300 KRW).

Meanwhile, according to cryptocurrency data provider Alternative, the Fear & Greed Index, which indicates investor sentiment as an index, dropped 3 points from 26 (Fear) the previous day to 23 (Extreme Fear) on the same day. Alternative's Fear & Greed Index means that the closer to 0 points, the more pessimistic investors feel (extreme fear), and the closer to 100 points, the more optimistic they are.