The Cryptomarkt got a slap on Saturday after credit rating agent Moody’s reduced the creditworthiness of the United States. Together with falling stock prices, this led to a flight from risky assets, in which investors are concerned about the rising American national debt and increasing uncertainty around the world economy.
Large altcoins under pressure
Ethereum (ETH), XRP and Dogecoin (Doge) each fell by approximately 3%on Saturday, after investors started responding to the possible consequences of the credit reduction. The total cryptomarkt dropped back to a value of $ 3.3 trillion, after reaching a peak of $ 3.4 trillion earlier this week.
No more triple-a status for the US
Moody’s points to the rapidly rising budget deficits, rising interest costs and the lack of political will to limit the expenses as the main reasons for the reduction. With this, the rating agency supports Fitch and S&P, who previously renounced the once unassailable Triple-A status of the United States.
White House Out of Criticism, Markets respond immediately
The White House responded immediately: President Donald Trump spokespersons labeled the credit reduction as politically motivated. The traditional markets meanwhile showed a clear reaction. The interest on American ten-year government bonds rose to 4.49%, while the S&P 500-Futures in the after-trade trade recorded 0.6% lower.
Bitcoin holds – for now
Historically, doubts about the American debt burden and a weakening dollar often cause extra support to Bitcoin and other decentralized assets. However, in the short term, credit reductions can lead to risk-suffering behavior, especially among institutional investors who lower their exposure in increasing macro illustria.
Kuptsikevich therefore expects that the market can fall back a little further in the short term, before there is room for the next upward movement.
Source: https://newsbit.nl/amerika-verliest-triple-a-status-beleggers-vluchten-uit-crypto-en-aandelen/
