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Bitcoin briefly spiked 4% on the news only to instantly give up those gains
The U.S. Federal Reserve has hiked the benchmark interest rate by 75 basis points, which marks the biggest increase since 1994.
Bitcoin, the world’s largest cryptocurrency, is changing hands at $20,889 on the Bitstamp exchange. The largest cryptocurrency briefly spiked by more than 4% on the news, but it then instantly erased those gains.
The Fed was widely expected to hike rates more aggressively after the consumer price index (CPI) recorded a year-over-year increase of 8.6%, which was a significant upside surprise for the market.
The central bank’s increasingly hawkish policy is widely believed to be the main headwind for risk assets like Bitcoin.
In its statement, the Federal Open Market Committee (FOMC) stated that it remains committed to cooling inflation, and it now expects the rate to rise to 3.8% next year.
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