Recent statements by Federal Reserve official Kashkari have attracted market attention. He pointed out that the central bank faces an irreconcilable contradiction between fighting inflation and maintaining economic growth. This signal is subtle but far-reaching — officials are hinting that future rate hike cycles may be more complicated than market expectations.

For the cryptocurrency market, this is not good news. Once the Federal Reserve continues to adopt a tight monetary policy to combat inflation, risk assets like Bitcoin and Ethereum are bound to come under pressure. Investors are generally worried that the rate hike cycle may be extended, which will raise the risk-free return rate and further squeeze the valuation space of digital assets. In the short term, this policy shift may continue to dampen the overall sentiment of the crypto market.