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In the cryptocurrency market, Bitcoin’s (BTC) market share has reached a new record of 61.2%. According to Matrixport’s report, Bitcoin’s dominance rapidly increased from 54% last December following a brief rally in altcoins. Experts emphasize that the Federal Reserve’s unexpected harsh statements and uncertainty around inflation data have redirected investors from altcoins back to Bitcoin 
$103,521. Despite hitting a historic peak of over $109,000 in December, Bitcoin is currently trading below the $85,000 threshold.
Altcoin Rally Disappoints Cryptocurrency Investors
The altcoin rally that began in November of last year was disrupted by strong employment data in the U.S. and the Fed’s decision to keep interest rates stable instead of cutting them. Matrixport reported that investors are moving away from high-risk assets like altcoins to more stable cryptocurrencies such as Bitcoin.
The Consumer Price Index (CPI) for February, reported at 2.8%, suggests a slowdown in inflation in the U.S., although this data was not sufficient to trigger full optimism in the cryptocurrency market.
The rapid impact of macroeconomic fluctuations on altcoins compared to Bitcoin is seen as a key reason for this decline. Major altcoins such as Ethereum (ETH) 
$2,596 and Solana 
$176 (SOL) have lost an average of 30% in value over the past three months.
Experts expect investors to patiently monitor the Fed’s policies in the coming months, suggesting that Bitcoin will continue to serve as a “safe haven.” This cautious approach towards altcoins is recommended until clearer signals from the Fed emerge.
Fed’s Interest Rate Policy, Bitcoin, and Altcoins
Recall that the Fed’s decision to maintain interest rates on January 29 caused a sharp decline in the cryptocurrency market. Following this decision, Bitcoin lost 20% of its value, while altcoins suffered even greater losses. However, the inflation data for February, which fell short of expectations, reduced the likelihood of any changes in the Fed’s March meeting by 85%, facilitating a recovery for Bitcoin and altcoins.
CME Group data supports the market’s expectation that the Fed will not cut rates in the first quarter of the year. Matrixport highlighted that Bitcoin could test the $90,000 level in the coming weeks, contingent upon stable declines in inflation. Additionally, a recovery in altcoins would require the Fed to provide a clear signal of monetary easing.
