Crypto and macroeconomics: understanding the game beyond the blockchain
Hello Friends of Project HOPE, good day everyone. Today I want to talk to you about something that I consider key if you are involved in the crypto world: it is always necessary to learn new things, and especially, understand what is happening in the macroeconomic environment.
The crypto market is no longer an isolated ecosystem, it stopped being that area where only decentralization and technology enthusiasts entered. Now it's something else...
With the arrival of Bitcoin and Ethereum ETFs, institutional capital is more present than ever, meaning prices are now much more sensitive to global economic news. It is no longer just supply and demand within the crypto ecosystem, now any movement in interest rates, employment in the US or inflation in Europe can cause Bitcoin to skyrocket or fall in a matter of minutes.
That is why it is important to learn to read and interpret macroeconomic news. It is not about becoming an expert in economics, but about understanding how certain data can affect liquidity in the markets. If the Federal Reserve raises rates, it means less money in circulation, which may cause investors to reduce their exposure to risky assets like cryptos. If unemployment in the US rises, it could mean an economic slowdown and affect market confidence. Everything is connected.
A clear example is what we have seen recently. Bitcoin has had significant falls, but if we look at the SP500 and the Nasdaq100, the two most representative indices of the US market, we see that the behavior is similar. It is not that the crypto market is dying, it is that money is leaving all risk assets in general due to macroeconomic reasons. I recently wrote a post where I talk about it: Here
So, partners, instead of panicking when you see a red candle, spend time understanding what is happening in the world. Learning to read these indicators can make the difference between making smart decisions or acting out of fear. Markets always have cycles, the important thing is to be informed and know how to play our cards. We continue!
