The **upheaval in the crypto market** and the **U.S. economy** are deeply interconnected, especially due to the role of the dollar (USD) as the dominant currency in cryptocurrency trading and the influence of American monetary policies on global risk. Let's analyze the main factors:
### **1. Impact of the U.S. Economy on the Crypto Market**
- **Monetary Policy (FED)**:
- When the **Federal Reserve (FED)** raises interest rates to control inflation, the crypto market tends to fall as investors migrate to fixed-income assets (like Treasury bonds) in search of safety.
- Example: In 2022, the high interest rates from the FED led to a "crypto winter," with Bitcoin (BTC) falling below $20k.
- **Inflation and Strong Dollar**:
- If inflation in the U.S. remains high, cryptocurrencies like Bitcoin are seen as "protection" (hedge), but if the dollar appreciates (as in 2024), the price of cryptos in USD may fall.
- **Regulation**:
- Actions by the **SEC** (such as lawsuits against Binance and Coinbase) or advancements in the approval of Bitcoin/Ethereum ETFs impact market confidence.
### **2. How Does the Crypto Market React to U.S. Economic Data?**
- **Key Indicators**:
- **Weak GDP**: May lead to expectations of rate cuts, benefiting cryptocurrencies (more liquidity in the market).
- **Jobs (NFP)**: Weak data = possible monetary easing = rise in cryptos.
- **CPI (inflation)**: If inflation falls, the FED may lower interest rates, favoring BTC and altcoins.
- **Correlation with NASDAQ**:
- Cryptocurrencies have shown correlation with tech stocks (NASDAQ). If the U.S. stock market falls, crypto often follows.
### **3. Current Scenario (2024)**
- **Expectations of Rate Cuts**:
- If the FED starts cutting rates (expected by the end of 2024), the crypto market may react positively (as it did in 2020-2021).
- **Elections in the U.S.**:
- A pro-regulation government (like Biden's) may pressure the market, while a more liberal approach (Trump) may bring optimism.
### **4. Risks and Opportunities**
- **Risks**:
- Banking crises (like the one with SVB in 2023) may increase demand for cryptos, but a recession in the U.S. could bring down all risk assets.
- **Opportunities**:
- If the dollar weakens and interest rates fall, cryptocurrencies like Bitcoin and Ethereum may benefit as a store of value.
### **Conclusion**
The crypto market remains highly sensitive to U.S. policies. If the American economy shows signs of slowing down with interest rate cuts, we may see a new rise in cryptocurrencies. However, inflationary or regulatory surprises can cause volatility.