Home » Bitcoin Bitcoin price climbs to $22.5K after Fed 75 basis point hike aims to cap runaway inflation Bitcoin Reading 3 min Views 3 BTC and altcoins generated nominal gains after the Federal Reserve raised the benchmark interest rate by 0.75%, the largest hike in 28 years. Global financial markets were squarely focused on the U.S. Federal Reserve and its decision to raise interest rates by 75 basis points on June 15, the largest increase in 28 years as the central bank fights to tamp down the highest inflation rates in over four decades. Data from Cointelegraph Markets Pro and TradingView shows that Bitcoin (BTC) and the wider cryptocurrency market fell under pressure in the early trading hours on June 15 as rumors of the possible collapse of Three Arrows Capital (3AC) spread across the ecosystem, which is still grappling with the ongoing Celsius debacle. Daily cryptocurrency market performance. Source: Coin360 Following the announcement from Federal Reserve Chair Jerome Powell that there would be a 75 basis point hike, the price of Bitcoin briefly spiked to $22,520 before pulling back to $21,500. BTC/USDT 4-hour chart. Source: TradingView The altcoin market likewise saw a brief price pump as the dire predictions of a possible 100 basis point hike failed to materialize and the market got largely what it expected from June 15 Federal Open Market Committee (FOMC) meeting. Traditional markets responded positively to the announcement with the S&P 500, Dow and NASDAQ all trading in the green for the day, but traders would be wise to see how markets behave at the daily close and tomorrow’s opening bell. Analysts digest the rate hike and its possible impact on crypto prices Shortly after Powell announced the 75 basis point hike, projections on when the Fed would start to cut rates started rolling in with the dominant consensus being that they would begin in 2024. BREAKING: The biggest rate increase since 1994 from the FED. However, expectations from FED policymakers are that they'll be starting to cut rates in 2024. — Michaël van de Poppe (@CryptoMichNL) June 15, 2022 The main reason for the rise in interest rates has been soaring inflation, which came in at a year-over-year increase of 8.6% according to the latest Consumer Price Index (CPI) print, which was higher than the analysts had predicted. Some analysts have begun to speculate that the reason for the highest rate hike in 28 years is part of an effort by the Federal Reserve to try and get ahead of the curve and establish enough leg room to be able to pause hikes in the future if economic conditions continue to worsen. They seem to be coming around to what I thought they would do in January (even before Ukraine). Frontload hikes which gives them cover to hit the pause button later while things may still be a bit too hot. I would expect to hear hawkish rhetoric today (gotta hike anyway). — The Long View ✪ (@HayekAndKeynes) June 15, 2022 Overall, the rate hike, which was largely expected, appears to have been priced into the crypto market because prices remained relatively flat following the announcement and currently, more crypto-specific developments are dominating the headlines in the sector. The overall cryptocurrency market cap now stands at $931 billion and Bitcoin’s dominance rate is 44.5%. The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.