Despite the recent lawsuits lodged by the Securities and Exchange Commission (SEC) against cryptocurrency exchanges Binance and Coinbase, Bitcoin’s price maintains its position near $26.5K. Market players are watching the Federal Reserve’s upcoming decision on monetary policy closely.
Valkyrie’s Chief Investment Officer, Steven McClurg, opines that the Fed may possibly halt its hawkish stance at the forthcoming FOMC meeting, though it might not be a lasting pause. Meanwhile, Bitcoin continues to demonstrate resilience in the face of industry-wide regulatory challenges and concerns over inflation and the central bank’s rigorous monetary policy.
Bitcoin Holds Firm Amid Regulatory Storms
The largest cryptocurrency, Bitcoin, was recently trading at approximately $26,474, remaining mostly flat over the past 24 hours. Its steady position has persisted since the SEC lawsuit against Coinbase and the request for a court order to freeze assets related to Binance.US earlier this week.
The SEC’s actions sparked concerns about potential market fallout, driving Bitcoin briefly below $26,000 on Tuesday. However, the cryptocurrency has since remained above the threshold, suggesting that investors might have preemptively factored in the regulatory action.
Resilience of Cryptocurrency Amid Regulatory Hurdles
Onchain custody platform CEO, Andrew Lawrence, highlighted Bitcoin’s and other key crypto assets’ strength amid the present tough regulatory scenario in the U.S. The global embrace of digital assets, he notes, particularly in regions like Asia, the European Union, and Dubai where crypto-friendly regulatory frameworks are emerging, is a key factor contributing to this resilience.
The Ethereum blockchain also demonstrated relative strength with the DeFi market capitalization down less than two percent compared to the general DeFi market’s five percent decline since the beginning of the month.
Rate Hikes Might Pause but Not For Long
The ongoing banking crisis might prompt the Federal Reserve to suspend its nearly year-long rate hikes, believes Steven McClurg, Valkyrie’s Chief Investment Officer. However, he along with other analysts expects this pause to be temporary due to continued price pressure and other macroeconomic uncertainties.
Rate hikes over the past year have generally caused unease among investors, leading to downward pressure on crypto prices. Furthermore, banking system threats have grown since a series of U.S. bank failures, linked by critics to the central bank’s overzealousness.
Bitcoin Investors Unfazed by Regulatory Heat on Coinbase, Binance
In spite of the intense regulatory pressure faced by two major players in the crypto industry, Binance and Coinbase, on-chain data suggests a bullish outlook as investors exhibit resilience. The crypto market has witnessed significant liquidations after SEC filed multiple charges against these entities.
Yet, data from Glassnode indicates an increased degree of resilience among market participants. The extent of ‘Realized Losses’ recorded on-chain remains at about $112 million, significantly lower than the largest recorded capitulation event.
Bitcoin Price and Network Health Unperturbed
Despite the downward pressure, Bitcoin’s spot price continues to find robust support at key pricing levels. Glassnode reports that staying above these levels would send a positive signal regarding the current trend.
Bitcoin’s price rebounded to nearly $27K before slipping slightly. The market’s ability to recover from initial turbulence depicts a confident outlook by participants, notwithstanding attempts to slow it down through regulatory pathways that lack clarity.
As for the network itself, Bitcoin’s hash rate and difficulty level have remained stable, unaffected by the regulatory turmoil, and continue to stay near their respective all-time highs.
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