Central Bank Policies Trigger Crypto Market Selloff
Bitcoin plunged below $85,000, extending its decline from October's $125,000 peak as Federal Reserve and Bank of Japan policy signals rattled markets. The crypto Fear and Greed Index languishes near 20 after briefly touching 10 - reflecting extreme investor anxiety amid tightening liquidity conditions.
Bank of Japan Governor Kazuo Ueda flagged a potential December policy shift away from negative rates, contingent on wage data. Meanwhile, Federal Reserve officials including Boston's Susan Collins emphasized high barriers to further easing without significant labor market deterioration.
These developments have propelled yields higher and strengthened the dollar, increasing funding costs while reducing leverage tolerance that previously supported crypto rallies. Market participants now face a transformed landscape where central bank policies rather than organic demand appear to be driving price action.
