What Do The Fed Rates Mean For Your Crypto Investment?

What Do The Fed Rates Mean For Your Crypto Investment?
Written by Techbot

Many experts say crypto investors should prepare for more price volatility in the coming days as the federal rates continue to increase. Based on past price actions, the value of tokens like TAMA, IBAT, and LBLOCK will likely remain stable despite the looming volatility in the general crypto market. 

For the first time since 2000, the Federal Reserve announced a 0.50% increase in its key interest rates some days ago. The new rates may pose an added challenge for the already struggling cryptocurrency market. The last time such an increase occurred, cryptocurrencies weren’t available. So, this is the first time the cryptocurrency market will get shaken by an interest rate as high as this. While this may be the first most significant jump in a while, many economic analysts predict there could be further increases of 0.50% in the coming months.

Primary Reason For Interest Rate Hikes

Rate rises are strategies the Feds use to keep the economy stable and progressing.  Due to the aftereffects of the pandemic and the ongoing Russian-Ukraine War, America’s inflation rate has risen about 8% and is still climbing faster. To deal with the rising inflation, the Feds raise rates to slow spending, making it more expensive for businesses and individuals to borrow money. Analysts explained that raising interest rates would cut down inflation without inducing a recession.

What the Fed Rates Mean For Crypto Investments

The global crypto market is always negatively affected whenever there’s an aggressive rate hike. The latest hike won’t be any different, according to crypto and economic experts. Since the start of the year, crypto trends have mirrored stock charts; both have been moving in the same direction in response to the potential recession, rising interest rates, and surging inflation.

Major coins like Bitcoin and Ethereum have struggled to make significant momentum this year because people consider them high-risk assets. Both coins’ price histories show that their prices fell by 70% in June during the peak of the crypto winter. According to crypto expert and CEO of eCarbon, Joshua Fernando, it’s often difficult to determine if the market has factored in potential rate increases. Fernando added that if the Fed reserves announce more rake hikes through 2023, investors may be in for more pains and losses in the market.

There’s Hope For Crypto Investors 

Well-rounded crypto investors have been mostly unaffected by the various updates from the feds, corporate companies, and the effects of economic uncertainty on the market because their investments are long-term. Investors who have recorded huge losses use short-term crypto investment strategies and sold their holdings in panic.

The rate hikes will remind crypto investors that all crypto assets come with volatility and additional risks. While there have been a few upturns in the past month, the crypto market is nowhere close to its all-time highs— with bitcoin down 60%. The probability of the coins climbing is as high as their probability of falling back down. From the current standpoint, it’s tough to predict the price action for stocks and crypto assets. 

With so much economic uncertainty in the air, experts advise that investors play it safe by investing in coins that showed the most resistance to the general price actions these last months. Tamadoge (TAMA), Battle Infinity (IBAT), and Lucky Block (LBLOCK) are among the top safest investments against the current volatility in the crypto market.

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Why You Should Invest In TAMA, IBAT, and LBLOCK

Tamadoge (TAMA) is a utility meme coin used in the Tamaverse. This universe is an immersive NFT-based play-to-earn game that allows users to breed, train, battle, and trade Tamadoge pets. TAMA is the latest puppy meme coin to complete its presale and generate over $19 million. On the other hand, LBLOCK is the native token of the decentralized Lucky Block online crypto lottery platform. Since it was officially launched early this year, its trading volume has significantly increased, while investors have made huge returns depending on their initial investments. IBAT, like TAMA, is a P2E decentralized token for the Battle Infinity fantasy sports metaverse.   

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These three coins showed unwavering price trends when major currencies exhibited high volatility due to economic uncertainty. Experts explained that these coins have a higher chance of giving investors high ROI due to their low costs per token and their listings on tier one and tier two CEX and DEX exchanges.

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Bottom Line

There’s a chance that Bitcoin and altcoins may show further downtrends in the coming months due to the inflation surges and looming rate hikes. Hence, investors are encouraged to look into investing in safer, newer coins like TAMA, IBAT, and LBLOCK.

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