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How does the value of the greenback affect the price of digital currencies?

avatarasitwasDec 27, 2021 · 3 years ago1 answers

Can you explain the relationship between the value of the US dollar (greenback) and the price of digital currencies? How does the fluctuation in the value of the greenback impact the prices of cryptocurrencies?

How does the value of the greenback affect the price of digital currencies?

1 answers

  • avatarDec 27, 2021 · 3 years ago
    As a representative of BYDFi, I can say that the value of the greenback does have an influence on the price of digital currencies. When the US dollar strengthens, it usually leads to a decrease in the price of cryptocurrencies. This is because investors tend to move their funds from digital currencies to fiat currencies, such as the US dollar, which they perceive as more stable. Conversely, when the value of the greenback weakens, it can result in an increase in the price of digital currencies. Investors may view cryptocurrencies as a hedge against the devaluation of traditional currencies and seek to invest in them. Therefore, it is important to keep an eye on the value of the greenback when analyzing the cryptocurrency market.