‘FED sledgehammer’ will further batter BTC, ETH prices, says Bloomberg analyst
The U.S. Federal Reserve’s inflation “sledgehammer” is about to batter the prices of Bitcoin (BTC) and Ether (ETH) down even further, before reaching back to new all-time highs in 2025, according to Bloomberg analyst Mike McGlone.
Ahead of the latest Fed interest rate hike to be announced this week, the market is expecting a minimum of a 75-basis-point increase, however some fear it could be as high as 100 basis points — which would represent the biggest rate hike in 40 years.
Speaking with financial news outlet Kitco News on Sept. 17, McGlone, the Senior Commodity Strategist at Bloomberg Intelligence, suggested that further market carnage is on the cards for BTC, ETH and the broader crypto sector, as Fed’s actions will continue to dampen investor sentiment.
The price of BTC has dropped 13.4% over the past seven days to sit at roughly $19,350 at the time of writing, while ETH has plunged a hefty 20.7% within that timeframe to around $1,350.
ETH’s 20% drop in particular has been a cause of discussion, as the price of the asset has tanked since the highly anticipated and long awaited Merge went through on Sept. 15.
With the major network upgrade essentially resulting in a “buy the rumor, sell the news event,” moving forward McGlone thinks that ETH might drop to “$1,000, or even get a bit lower" given how hawkish the Fed has been, and will continue to be, this year.
"I'm afraid [The Merge] got too hyped," said McGlone, adding that ETH’s price decline is “within a significant macroeconomic broad-based bear market for all risk assets.”
During the interview, McGlone even went as far as to predict that the latest rate hike could cause a crash across assets that is worse than the 2008 housing bubble meltdown.
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