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$1,539,651,475,778
$12,011,131,458
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Meanwhile, The UK Records A 10-Year High In Inflation, After Rendering Bitcoin Worthless

The crypto sector is seemingly becoming a force to be reckoned with, as news from sectors outside the crypto industry is increasingly starting to take effect on Bitcoin, for example.

On Wednesday, December 15, the U.S. Federal Reserve hinted that their stimulus program may end quicker than expected and interest rates may see an increase to fight the ever-increasing inflation.

According to the Federal Open Market Committee (FOMC), the Federal Reserve would end the program in March and open the door for the central bank to increase the benchmark borrowing rate.

Increasing the borrowing rate would happen with three-quarter percentage point interest rate increases by the end of 2022, which admits the U.S. economy suffers from inflation.

Jim Caron, a senior portfolio manager and chief strategist at Morgan Stanley Investments noted that the FED’s move is a breath of fresh air since equity markets anticipated a much more aggressive scenario.

“From an equity perspective, now they just have to focus on earnings, margins, and growth. It’s kind of a sigh of relief to the equities market who though it might be much more aggressive. It’s kind of what we were thinking anyway.” Carron stated.

Bitcoin, on the other hand, has always been perceived as an inflation hedge and the news pushed Bitcoin bulls and the price per Bitcoin spiked to $49,473.96 after a daily low of  $46,671.97 and a weekly bottom of $45,894.85.

d5836a8a08bf2c96b32b47a504883267Source: CryptoBrowser

Currently, the biggest crypto to date is trading at $48,650.08 with both market cap and daily volumes increasing accordingly.

Meanwhile, popular crypto analyst Michaël Van de Poppe noted that the positive Federal Reserve signs keep Bitcoin in a bullish stance.

FED keeps its interest rate at 0-0.25% as it is committed to employing the full range of instruments available to help the US economy. Which means. The bull market continues for Bitcoin.” Van de Poppe noted on Twitter, adding that Ethereum’s price action may be stepping outside the correction and would gain price increase momentum.

However, the positive U.S. Federal Reserve signs are in total contrast with the Bank of England’s warnings that the number one crypto could become worthless.

Bank of England’s statement pushed inflation rates in the UK to a 10-year high of 5.1%.

“Their price can vary quite considerably and [bitcoins] could theoretically or practically drop to zero." Deputy Governor of Bank of England, Sir Jon Cunliffe, stated.

John Paulson, president, and portfolio manager of U.S. investment firm Paulson & Co. have backed Cunliffe’s opinion, warning investors not to invest in cryptocurrencies.

“Cryptocurrencies, regardless of where they’re trading today, will eventually prove to be worthless. Once the exuberance wears off, or liquidity dries up, they will go to zero. I wouldn’t recommend anyone invest in cryptocurrencies." Paulson noted.

Nevertheless, more and more UK residents are referring to Bitcoin and other cryptocurrencies as a perfect inflation hedge, despite the volatility concerns and regulatory scrutiny around cryptos.

Gita Gopinath, chief economist at the International Monetary Fund (IMF) warned emerging economies that they have to be prepared for cryptocurrencies evolving over time and the need for those economies to develop an effective crypto regulation to maintain a stable economic structure.

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