Why is it that bitcoin and other cryptocurrencies have declined in response to the inflation rate rising? Should the response be the other way around? Bitcoin is anti inflationary so it makes more sense to use bitcoin to protect the value of your bitcoin. So, why was the response like this? What do you think so?
I wouldn't put too much on this factor. I mean we have been in at least 3 bull runs already, at least some of us, so if ever the price during this run hits a snag because of some news, then it's not that it will be the end of us. It will just be temporary and once it settled again, the price is going to go up parabolically and we will see a new all time high. People should not panic about what the FED is going to say, sure it has some negative effect on the whole market because they're responsible for the monetary policy of the US. But other than that, we shouldn't take the news very seriously. If we did then we will panic sell every time we hear negative news from them. So let it simmering down and in just a week or two we might be back again.
There have already been multiple bull runs, and every single time there were moments when negative news came out and shook the market, but it never really marked the end of the run, it only slowed things down for a while before the recovery kicked in again, and the cycle pushed the price even higher towards a new all time high. People often forget that panic selling is usually what hurts them more than the actual dip itself, because the market eventually balances back and continues its natural movement. News from the Fed, or any big institution, will always have some short term impact since they deal with monetary policy and global finance, but putting too much weight on it can cause unnecessary stress and hasty decisions. Instead of reacting in fear, it makes more sense to let things settle, and remember that time after time Bitcoin has shown strength after setbacks, so waiting it out calmly often turns out to be the smarter move.