Cryptocurrencies across the board plummeted as investors weighed the possibility of an extended period of monetary tightening.
Bitcoin (BTC) and ether (ETH) have lost their momentum over the past seven days, with each posting 6% declines as investors worried about inflation and continued monetary hawkishness.
On Friday, the two largest cryptocurrencies by market capitalization plunged after the U.S. Commerce Department reported that the personal consumption expenditures (PCE) price index climbed by an unexpectedly robust 5.4% in January, offering the latest evidence that inflation remained problematic. The PCE price index is the broadest measure of inflation.
The news caused the dollar to strengthen, which in turn caused the prices of bitcoin and ether to drop. The two cryptocurrencies have since recovered some of their losses, but they remain down from where they were last week.
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