Bitcoin traded almost flat and Ethereum was in the red on Wednesday night after the US Federal Reserve signaled more rate hikes for 2023. Global cryptocurrency market cap fell 0.3% to $867 billion as of 8:05 p.m. EST.
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See also: Is Binance better than Coinbase?
Why is it important: The Federal Reserve on Wednesday raised its target federal funds rate by 0.5% to between 4.25% and 4.5%, in line with Wall Street expectations.
The Federal Free Market Committee members don’t see a pivot between rate hikes and cuts until 2024, according to a previous report.
“We may have to raise rates to get to where we want to go,” Fed Chairman said Jerome Powell Wednesday.
“The Fed has not welcomed the disinflationary trends that are just beginning to emerge and has focused on robust job gains and high inflation. Any hope of a soft landing is gone as the Fed seems committed to taking much higher rates,” said Edouard Moyasenior market analyst at OANDA.
Bitcoin pared gains after the Fed announced a lower rate hike than recent meetings, but signaled that “continued increases” are likely appropriate. Cryptos are dragged lower as the dollar rallies with the return of risk aversion,” Moya said, in a note seen by Benzinga.
The S&P 500 and Nasdaq closed down 0.6% and 0.8% respectively on Wednesday. At the time of writing, US stock futures have risen slightly. Major cryptocurrencies were seen trading lower with Bitcoin largely stable.
Michael van de Poppe said the reaction to the rate hike had been “boring”. He said the dollar index, a measure of the greenback’s strength against six other currencies, gave all its bounce back.
Bitcoin “had a big run, up, a little too wide and in [high-timeframe] resistance. Probably looking for HL in the markets and then we will continue the uptrend,” the trader said.
Bitcoin will see some consolidation as it seeks a higher low. The zone to hold remains at $17,200 to $17,400, according to Van de Poppe. He said the way to $20,500 is open in 2-4 weeks.
Market intelligence platform Holy noted that cryptocurrency platform topics such as “inflation” and “recession” reached their 4th highest peak on record following the FOMC meeting and rate hike of interest.
A CryptoQuant the analyst opposed the position of Binance and FTX in a Twitter thread. Binance “has always been pretty transparent with cold wallets. FTX has never been – never even had identifiable cold wallets. there’s a world of difference between the two,” the analyst said.
Digital Delphi noted that over the past two days, the total value of Binance’s on-chain wallets has fallen from $65 billion to $60 billion, with the exchange seeing outflows of more than $5 billion.
Total Value of Binance On-Chain Wallets – Courtesy of Delphi Digital
“As the US Congress holds hearings on the FTX collapse, concerns about Binance have grown, leading to increased withdrawals,” the independent shop data platform said.