Jim Cramer Warns Stock Markets May Be Affected by Potential Fed Rate Hike

WHY IT MATTERS

The Federal Reserve (often called "the Fed") is the central bank of the United States, and one of its main tools is setting interest rates — essentially the cost of borrowing money. Think of interest rates like a thermostat for the economy: when rates go up, borrowing gets more expensive, which tends to cool down spending and investment. This matters for crypto because when traditional investments like savings accounts offer higher returns due to rising rates, some investors may move money away from riskier assets like cryptocurrencies. Understanding how central bank decisions ripple through all financial markets, including crypto, is an important part of learning how the broader economy works.