Fed chair says market “frothy,” altcoins attract interest



Federal Reserve Chairman Jerome Powell is noting some of the stranger and more unprecedented types of activity in today’s equities market and beyond.


Coindesk’s Sebastian Sinclair reports remarks by Powell at a recent event, where he conceded that the market is looking, in his words, a little “frothy.”


Powell also reportedly took some responsibility for volatility, admitting that “easy money” has had its own impact. However, he also cited vaccination and reopening as factors impacting more vibrant trading activity and everything that goes along with it.


Meanwhile, as recently as this week, the Fed came out with indicators that it will continue to keep interest rates low and maintain its bond-buying program.


Saying the economy is “strengthening” and calling existing inflation “transitory,” Fed teams want to stay the course on the kinds of system-propping measures they put in place after the 2008 financial crisis.


How’s all of this affecting cryptocurrency?


Bitcoin, at this point, is holding very stable around the $55,000 mark. After spiraling up from under $10,000 at the end of last year, it seems the gyrating volatility around Bitcoin has stopped for the moment. Other coins like Ethereum are similarly strong on the market, and for the moment, it seems the real stars are the altcoins.


“Ether (ETH), the largest altcoin, which hit fresh all-time highs this week, is showing itself to be particularly uncorrelated to Bitcoin under current conditions,” writes William Suberg at Cointelegraph.


“Bitcoin dominance has been on a continuous decline over the past month falling to a new low of 48.42% today from a 72% dominance at the start of the year,” adds Prashant Jha at Coingape. “A declining Bitcoin dominance is often seen (as) beneficial for the altcoins and as BTC struggle to regain the losses from the past week, most of the altcoins have started rising to new highs.”


Plan accordingly.