JPMorgan strategist warns of a collapse in the crypto market after the Fed raises rates

Investors in cryptocurrencies will suffer huge losses as the Fed raises the key rate and ends the era of „crazy speculation“. JPMorgan senior strategist David Kelly made the announcement in an interview with Business Insider.
“At a certain stage, I expect a strong decline in the prices of digital assets. They are vulnerable to monetary tightening,” the expert said.
Kelly compared cryptocurrencies to „magic powder“. Interest in them arose due to the stimulating policy of the Fed, which forced investors to switch from bonds that do not bring anything to more risky assets.
“If real interest rates return to the positive zone, you will deprive yourself of crazy ideas about cash and direct funds to projects with real economic returns. Anything highly valued will be vulnerable if the Fed gets aggressive early on,” he explained.
Recall that at a press conference following the meeting in January, Felreserve Chairman Jerome Powell did not rule out an increase in the key rate in March by 50 basis points at once. n. He also allowed monetary tightening at every meeting.
In January, Bitcoin reacted with a drop of 7.5% to levels below $43,000 of the publication of the minutes for the December meeting of the Fed.
In a transcript of the latest rate decision, Fedreserv noted the growing financial stability risks associated with the rapid growth of crypto assets and DeFi platforms.