Bitcoin Is On The Rise After Fed’s Remarks
Bitcoin rallied today after news that the Federal Reserve will buy unlimited amounts of Treasuries and securities. Not only Bitcoin but also traditional markets saw increases in the wake of this news.
The Federal Reserve reversed its decision to set aside $ 700 billion for asset purchases, and instead, now the limit has been lifted altogether. In response, America announced that it would buy “unlimited amounts of Treasury and mortgage-based securities” to support the financial market. The FED also said it was working on a new loan program worth up to $ 300 billion to support the companies.
In the wake of this news, leading cryptocurrency Bitcoin reacted positively, pushing its price up to $ 6,300. But along with Bitcoin, traditional markets have also risen, and this has been seen as evidence of the correlation between the two markets.
In addition, although the FED changed its decision to print money in a different direction, the decision was described by economists as a last-ditch effort. So this decision can be conceived of good things and bad things.
There Is Still A Possibility Of Recession
Despite the rise of financial markets, real economic data on the US economy still looks extremely weak. For example, according to former White House economic adviser Gary Cohn, the US is now effectively in recession.
However, no matter how much America is used to supporting the economy, data such as unemployment, which has reached 20%, show that the economy is in pretty bad shape. Therefore, economists point out that a much bigger crisis could occur than the 2008 financial crisis.
On the other hand, if Bitcoin continues to react with traditional markets, a similar cryptocurrency market could be seen in 2018.