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Bitcoin Steady as BOE Hikes Rates by 50 Basis Points, 'Reverse Currency Wars' Gain Steam
The race among central banks to lift rates and support their currencies to keep inflation in check suggests the path of least resistance for risky assets is to the downside.
Updated May 11, 2023, 4:39 p.m. Published Sep 22, 2022, 11:30 a.m.
Bitcoin (BTC) held steady on Thursday after the Bank of England raised its benchmark interest rates by 50 basis points (bps) to 2.25% in a continued fight against inflation.
The BOE's second straight 50 bps move came a day after the Federal Reserve delivered its third consecutive 75 bps rate hike and signaled a higher terminal rate or peak rate of 4.6%.
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The BOE said the inflation peak is likely to be lower than projected in August, at just under 11% and maintained that its policy isn't on a preset path.
The Swiss National Bank also lifted its borrowing cost by 75 basis points early during the day, exiting the negative interest rate policy. Meanwhile, Japan intervened in the foreign-exchange markets to stall the yen's slide.
The coordinated tightening, which began early this year, represents reverse currency wars – a race among central bankers to raise rates and support their fiat currencies to keep inflation in check.
The reverse currency wars indicate the path of least resistance for risky assets, including cryptocurrencies, is on the downside. Some analysts, however, believe the crypto market has already taken a beating and there is little downside left.
"Even if central banks tighten monetary policy further, the situation will not worsen more, for the current performance of crypto assets is terrible enough," Griffin Ardern, volatility trader from crypto asset-management firm Blofin, told CoinDesk.
Bitcoin was changing hands at $19,080 at press time, up 3% for the day, according to CoinDesk data.
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Exchange Review - March 2025
CoinDesk Data's monthly Exchange Review captures the key developments within the cryptocurrency exchange market. The report includes analyses that relate to exchange volumes, crypto derivatives trading, market segmentation by fees, fiat trading, and more.
What to know:
Trading activity softened in March as market uncertainty grew amid escalating tariff tensions between the U.S. and global trading partners. Centralized exchanges recorded their lowest combined trading volume since October, declining 6.24% to $6.79tn. This marked the third consecutive monthly decline across both market segments, with spot trading volume falling 14.1% to $1.98tn and derivatives trading slipping 2.56% to $4.81tn.
- Trading Volumes Decline for Third Consecutive Month: Combined spot and derivatives trading volume on centralized exchanges fell by 6.24% to $6.79tn in March 2025, reaching the lowest level since October. Both spot and derivatives markets recorded their third consecutive monthly decline, falling 14.1% and 2.56% to $1.98tn and $4.81tn respectively.
- Institutional Crypto Trading Volume on CME Falls 23.5%: In March, total derivatives trading volume on the CME exchange fell by 23.5% to $175bn, the lowest monthly volume since October 2024. CME's market share among derivatives exchanges dropped from 4.63% to 3.64%, suggesting declining institutional interest amid current macroeconomic conditions.
- Bybit Spot Market Share Slides in March: Spot trading volume on Bybit fell by 52.1% to $81.1bn in March, coinciding with decreased trading activity following the hack of the exchange's cold wallets in February. Bybit's spot market share dropped from 7.35% to 4.10%, its lowest since July 2023.
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