Uncovering ‘crypto week’ – Senator Tim Scott reinforces future of digital assets
- U.S. crypto mining stocks plummeted despite a sharp rebound in overall market cap.
- Fed rate uncertainty and Trump’s Bitcoin treasury plan fuel market-wide FUD.
U.S. crypto mining stocks experienced a significant decline today, mirroring the overall market volatility.
Earlier, a wave of selling pressure pushed Bitcoin [BTC] below the critical $110k level, triggering a brief but intense downturn across the crypto landscape.
The market sentiment quickly turned sour, creating what many described as a “bloodbath.” However, this pullback was short-lived.
Unexpectedly, the global cryptocurrency market capitalization jumped to $3.56 trillion, reflecting a remarkable 317.4% rise within 24 hours, according to CoinGecko.
This was a swift rebound despite earlier market fears.
Crypto mining stocks dip
However, while the overall crypto market showed signs of recovery, the same couldn’t be said for crypto mining and related tech stocks.
As per data from Google Finance, Riot Platforms [RIOT] closed on the 28th of May with an 8.32% decline, while CleanSpark [CLSK] and Marathon Digital Holdings [MARA] saw drops of 7.61% and 9.61%, respectively.
Crypto exchange Coinbase [COIN] also faced a setback, dropping 4.55%.
Meanwhile, MicroStrategy [MSTR], known for its heavy Bitcoin holdings, extended its five-day losing streak with a 2.14% dip, amid growing legal troubles.
On a broader note, the S&P 500 also closed the day in the red, slipping by 0.56%.
Why is crypto down today?
The sharp decline in crypto mining and tech-related stocks came shortly after the release of the Federal Open Market Committee’s (FOMC) meeting minutes from the 6th and the 7th of May.
Published on the 28th of May, the document highlighted concerns about the potential challenges ahead for the U.S. economy.
The Fed noted it may face tough decisions if inflation proves more stubborn while growth and employment show signs of weakening.
However, despite mounting pressures, the central bank opted to keep interest rates unchanged at 4.25% to 4.50%.
It cited growing uncertainty surrounding the economic outlook and rising risks of both inflation and unemployment as key reasons behind the pause.
Remarking on the same, trader Chapo noted,
Source: Chapo/X
Is Trump behind this fallout?
Looking ahead, the market remains on edge as the next Federal Reserve interest rate decision, scheduled for the 18th of June, approaches.
Nearly 97.8% of market participants anticipate that the Federal Reserve will maintain current interest rates, per the CME FedWatch Tool.
Adding to the market’s anxiety is the announcement of Trump Media’s ambitious $2.5 billion plan to build a Bitcoin treasury, an initiative that has drawn mixed reactions.
While some view it as a bullish sign for crypto adoption, others are wary of the underlying political motives.
Compounding the uncertainty is the return of a 25% tariff on the EU beginning 1st June, reigniting inflation concerns just months after a temporary truce.
Together, these developments have injected a fresh wave of FUD into an already volatile crypto landscape.
