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Market Wrap: Bitcoin Holds Above $60K After Fed Taper Announcement

Market Wrap: Bitcoin Holds Above $60K After Fed Taper Announcement

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Bitcoin traded in a uneven value vary on Wednesday as merchants reacted to the U.S. Federal Reserve’s plans to taper its $120-billion-a-month in bond purchases.

The unprecedented quantity of shopping for by the Fed as a part of its financial stimulus plan often known as quantitative easing (QE) offered a tailwind for monetary belongings, corresponding to cryptocurrencies, deemed by the market to be dangerous. But decrease liquidity because of the tapering might encourage buyers to scale back their publicity to crypto and different dangers.

Bitcoin’s value fell by about 5% through the announcement by the Fed’s policymaking Federal Open Market Committee in its post-meeting assertion, however consumers had been fast to step in across the $60,000 support level.

Analysts stay bullish on cryptocurrencies, however some have pointed to declining buying and selling quantity as an indication of slowing upside momentum in costs.

“We haven’t even seen an episode of FOMO (fear of missing out) yet, so the sharpest bull-run part of the rally is yet to come,” Alex Kuptsikevich, an analyst at FxPro, wrote in an e-mail to CoinDesk. “Despite BTC’s very sluggish performance in recent days, what still draws attention is the apparent support on dips,” Kuptsikevich wrote.

Latest Prices

  • Bitcoin (BTC): $62,997.19, -0.64%
  • Ether (ETH): 4,630.40, +2.78%
  • S&P 500: 4,660.57, +0.65%
  • Gold: 1,772.56, -0.83%
  • 10-year Treasury yield closed at 1.596%

Bitcoin rally on low buying and selling quantity

Trading quantity within the bitcoin spot market continued to say no regardless of bitcoin’s value rally over the previous month. The chart beneath exhibits the seven-day common BTC buying and selling quantity, which is down virtually $1 billion from the earlier week, based on knowledge compiled by Arcane Research.

But some analysts anticipate increased buying and selling exercise if BTC rallies via the tip of the 12 months.

“The trading volume has decreased substantially since bitcoin hit an all-time high on October 20, and it should increase considerably if bitcoin is to challenge its all-time high again soon,” Arcane wrote in a Wednesday report.

Trading has additionally been comparatively quiet on the Coinbase crypto trade over the previous week, with BTC accounting for 21% of complete quantity. However, the corporate famous that buying and selling exercise is beginning to enhance in different cryptocurrencies (altcoins) as bitcoin’s value stalls.

“Ether (ETH) volumes have also seen an increase to 18.51%, relegating SHIB to the third spot,” Coinbase wrote in a publication to institutional shoppers, referring to the shiba inu coin. “It is possible to envisage a scenario where ETH will again overtake BTC in terms of volumes as we head into year-end if this narrative gains steam.”

Altcoin roundup

  • Layer 2 cash are thriving as Ethereum prices are rising: The common price on Ethereum has given rise by 2,300% since late June and is now at $56. This seems to be driving buyers to cash related to layer 2 merchandise that facilitate quicker and cheaper transactions, and people of rival programmable blockchains, CoinDesk’s Omkar Godbole reported. This allowed Solana’s SOL token, which surged in value by 13% up to now 24 hours to $234, to cross Cardano’s ADA because the fifth-largest cryptocurrency, based on CoinGeckio. At the identical time, smart-contract blockchain Polkadot’s DOT token additionally rallied to an all-time excessive of $53.37 early Wednesday.
  • EOS Foundation CEO says, “EOS, as it stands, is a failure:” At a digital occasion on Wednesday, Yves La Rose, CEO of the EOS Foundation, claimed the EOS blockchain protocol’s native foreign money, EOS, has been “a terrible investment,” CoinDesk’s Andrew Thurman reported. La Rose’s speech locations a lot of the blame on backer and former developer, which the venture will now not be counting on for steering. He additionally stated that EOS was “a victim of its own success,” and that it was put ready of “having to meet extreme expectations as it raised extreme sums.”
  • Kraken fails to record SHIB: Cryptocurrency trade Kraken has did not record standard meme token SHIB on its trade after it promised to take action on Twitter, CoinDesk’s Muyao Shen reported. In a tweet on Monday, the trade stated that in the event that they bought 2,000 “likes,” it might record shiba inu on Tuesday. However, at press time on Wednesday, SHIB remains to be not available for purchase and promote on Kraken regardless of the tweet having over 77,000 likes. The lack of motion by Kraken has triggered anger on social media, with one person tweeting, “[Y]ou have lost me as lifetime customer now.”

Relevant information

  • JPMorgan Report Says CBDCs Can Save Firms $100B a Year in Cross-Border Costs
  • Riot Blockchain Raises Hashrate Guidance by 11.7% for 2022
  • Direxion Withdraws Application for Short Bitcoin Futures ETF
  • China’s CBDC Has Been Used for $9.7B of Transactions
  • Digital Currency Group Achieves $10B Valuation in $700M Secondary Sale

Other markets

Most digital belongings within the CoinDesk 20 ended the day increased.

Notable winners as of 21:00 UTC (4:00 p.m. ET):

  • Polygon (MATIC): +5.51%
  • XRP (XRP): +5.19%
  • Polkadot (DOT): +4.84%

Notable losers:

  • Dogecoin (DOGE): -2.34%
  • The Graph (GRT): -1.64%
  • EOS (EOS: -1.42%
  • Chainlink (LINK): -1.4%


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