Bitcoin Falls Following Fed’s Decision to Open Spigot
Bitcoin prices remain on the defensive and are still projected to drop as investors brace for the Spigot. The US Federal Reserve and other banks open cash Spigot as they scramble to reduce the impact of the pandemic.
Bitcoin is seen falling for more than 5% this Friday against the USD. In fact, the BTC/USD day’s range reached around 7,365.7 and has fallen to as low as 6,874.1.
The crypto market as a whole feels the pressure as other digital coins also fall in today’s trading sessions. Ether was also down by at least 8% against the US dollar this Friday.
Just recently, the United States Federal Reserve announced a new round of stimulus measures against the devastating virus. The US Authorities have met the sheer damage of the paralyzing pandemic with unprecedented measures.
According to reports, the Fed has ramped up its program, rolling out $2.3 trillion to counter a massive recession. The new budget allots $600 billion to the “Main Street Lending Fund” to support medium and small businesses.
Cryptocurrency traders immediately stepped back following the announcement to recalibrate.
The Fed’s program made it into the US Congress and into law late last month on March 27. Through the program, the Fed will allocate money and allow small firms, freelancers, and other workers to borrow more money.
Under the law, workers and businesses could borrow cash that up to two and a half times more than their average payroll. The maximum amount for the loan reaches $10 million for companies with less than 500 workers.
The borrowers could use non-recourse funding to help cover the salaries of their employees. The loan could also cover other company or employee expenses until the end of June.
Digital Coin Market and Traditional Market
Major indices in the United States and other major have been starting to perform better. The recovery may not be as big as investors would have wanted, but it should have reflected in the digital market.
Unfortunately, Bitcoin and other digital coins have struggled to keep up with the performance of indices. Experts say that cryptocurrencies should have performed better following the moves in the conventional market.
Bitcoin prices seem stuck in a narrow trading range as both bears and bulls struggle to gain momentum. However, it’s widely believed that the digital coin will hold on to its bullish sentiment for a month or more.
The current drop from the highly volatile coin comes from the recent action from the Fed.
