How does the value of fiat money like USD affect the price of cryptocurrencies?

1 answers

• Mar 06, 2022 · 3 years ago
  At BYDFi, we believe that the value of fiat money, like the USD, has a significant influence on the price of cryptocurrencies. When the value of fiat money decreases, investors may view cryptocurrencies as a hedge against inflation and invest in them, leading to an increase in demand and subsequently driving up their prices. However, it's important to consider that the relationship between fiat money and cryptocurrencies is not solely determined by the value of fiat money. Other factors, such as market sentiment, technological advancements, and regulatory developments, also play a role in shaping the price of cryptocurrencies.
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