Major cryptocurrencies like ether (ETH), XRP, and dogecoin (DOGE) saw a decline of approximately 3% following Moody's downgrade of the U.S. sovereign credit rating from Aaa to Aa1. The downgrade is attributed to rising fiscal deficits, increased interest expenses, and a political environment deemed inadequate for addressing spending issues. This news triggered a wave of risk-off sentiment in both traditional stock markets and crypto assets. Following the announcement, U.S. Treasury yields rose, with the 10-year note reaching 4.49%, while S&P 500 futures dipped by 0.6%. Historically, such credit downgrades can lead to initial risk aversion among investors, particularly institutional players. However, concerns about U.S. debt sustainability usually boost interest in decentralized assets like bitcoin. Some analysts warn of possible short-term sell-offs ahead, with key price levels under scrutiny. Bitcoin's hold above $104,000 remains significant, although pressure near the upper boundaries of its current range suggests a potential decline before any attending recovery.

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