“In a downward trending crypto market, Bitcoin is the safest bet,” Arcane Research wrote. “This has led Bitcoin’s market dominance to increase.” As the US inflation reaches a 13-year high, the entire cryptocurrency market weakens. Looking at last year’s relationship between Bitcoin and the monetary policy: Bitcoin price quadrupled as the US Federal Reserve pumped trillions of dollars into financial markets, nearly doubling in one year the amount of money it had created over the prior 107 years.
The largest cryptocurrency is seen by many digital-asset investors as a hedge against inflation, and so the price reaction led to some head-scratching among Wall Street analysts. Looking back at Bitcoin’s historic performance when the Fed was printing money, the current trend is out of the ordinary to say the least. However, when compared to other coins in the crypto market, Bitcoin is regaining its dominance in terms of market capital. Although nowhere near its all-time high, it is still the most powerful among all the cryptocurrencies.
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