However, Bitcoins showed some strength on Tuesday, ahead of Fed Chairman Jerome. Powell testimony before the US Congress later in the day, which may point to signs of downsizing and rate hikes expected later in the evening.
Rising inflation, aggressive central bank stance and extreme volatility weigh on the economy crypto markets. Goldman Sachs' projection of four rate hikes in 2022 has sent the crypto market a deep red.
All eyes are on Powell's comment to Congress, which has clarified his goal of curbing inflation. Markets will seek guidance from the Fed Chairman, as financial markets do not like uncertainty.
Edul Patel, CEO and co-founder of Mudrex, said there is a lot of uncertainty amid speculation about the announcements the company will make. Federal Reserve President.
"With inflation almost out of control, it is likely that we are facing some drastic measures from the US Federal Reserve. This uncertainty is causing the market to react nervously," he added.
The total market capitalization of the crypto market has slipped below the $ 2 trillion mark as the top giant loses its luster. The crypto market's traded volume has taken a major hit as daily volumes have remained below 100 billion.
The world has seen an unprecedented amount of money printing in recent years, which has demonstrated its effect on asset prices across all asset classes.
Shivam Thakral, CEO of BuyUcoin, said that if a drawdown is made, it will decrease the liquidity of the fiat currency in the market and may have a significant impact on cryptocurrency prices and other asset prices around the world.
"We are hopeful that his testimony before Congress will generate positive sentiment in the crypto market," Thukral said.
Cryptocurrency experts suggest that investors shouldn't read too much between the lines. Powell has shown his optimism for cryptocurrencies and the blockchain before.
Powell acknowledged that inflation is the main concern, but has not commented on rate hikes, Patel said. However, "the Federal Reserve would focus primarily on tackling the inflation situation."
Not just Bitcoin, Ethereum broke the $ 3,000 mark on Monday. Other major tokens, including BNB, Solana, Cardano, Terra, Polkadot, Avalanche, have lost up to 15-20 percent of their value in the last week.
Aggressive comments from Powell could test support for riskier assets later in the day. However, experts believe that the falls are an opportunity to buy.
BuyUCoin's Thukral said seasoned investors are buying the dips and increasing their holdings, while Mudrex's Patel suggested investors to cost-to-dollar-average (DCA) to ease the pain of timing the market.
