The cryptocurrency market has been in a bearish trend over the past few months, and FTX’s Bankman-Fried says the dollar’s rise is behind the decline.
Sam Bankman-Fried, the CEO and founder of the FTX crypto exchange, told Bloomberg in a recent interview that the US Dollar’s rise in recent months is behind the general decline in the cryptocurrency market.
He stated that the Fed’s policies have strengthened the US Dollars but have negatively affected the crypto and other financial markets. Bankman-Fried said;
“Dollars are up this year. This is the year of policy change.”
Bitcoin, the world’s leading cryptocurrency by market value, is down by more than 50% since the start of the year. Meanwhile, the Bloomberg Dollar Spot Index climbed about 10% during the same period.
This comes as the United States Federal Reserve raised borrowing rates in an attempt to slow inflation.
Despite the current market conditions, Bankman-Fried said he remains optimistic about cryptocurrencies due to the regulatory clarity that is coming to the industry. He believes that regulatory clarity will help unlock the crypto asset class for numerous financial institutions that want to get involved in the sector.
Bankman-Fried’s comments come a few days after the venture capital arm of FTX bought a 30% stake in Anthony Scaramucci’s SkyBridge Capital.
FTX has become one of the biggest spenders during this bear market, with the company shelling out hundreds of millions of dollars.
The company has issued bailouts to struggling cryptocurrency companies in a bid to save them and ensure they continue to provide services to their clients. The move has earned Bankman-Fried the title of JPMorgan of the crypto space.
The total cryptocurrency market cap reached an all-time high of $3 trillion in November 2021. However, with the bear market currently in play, the total crypto market has dropped to around $1 trillion.