"Relax everyone, it just fell a little bit, maybe next week it will go back up."
Failing to continue climbing higher, the price of cryptocurrency king Bitcoin (BTC) hovered below $63,600 after the United States (US) Labor Department yesterday showed jobless claims rose by 1.867 million.
The decline in BTC prices was also triggered by US-listed technology stocks being affected shortly after Bloomberg reported that the US is analyzing regulations to control the export of the most important technology on Artificial Intelligence (AI).
According to Jim Covello, head of equity research at Goldman Sachs, the AI investment frenzy could lead to an economic bubble following AI investment seeing modest returns with Microsoft, Google and Amazon only generating 7% of cloud service sales growth on AI.
Crypto investors also paid attention to the meeting of the European Central Bank (ECB) last night which decided to maintain the main interest rate, where 4.25% for the main refinancing operation, 4.5% for the marginal lending facility and 3.75% for the deposit facility.
It should also be noted that the International Monetary Fund (IMF) which recommended that the Federal Reserve (Fed) should not reduce interest rates until the end of 2024 has caused the expectation of an interest rate cut as early as next month to decrease.
IMF Chief Economist Pierre-Olivier Gourinchas stressed the need to be cautious on rates while the Fed is still at a historic high of 5.50% and premature cuts could risk pushing inflation further.
So here it can be seen that the Fed's decision to follow the ECB's guidance in maintaining stable interest rates can have significant implications for the crypto market, especially BTC, which can also be affected in the short term due to the IMF's stance.
As of this writing, BTC price has plunged by 1.35% to $63,783 in the last 24 hours with a market cap of $1.2 trillion but is still up 12.12% over the last week.
