Bitcoin traded nearly flat and Ethereum was in the red on Wednesday evening after the U.S. Federal Reserve signaled more rate hikes for 2023. The global cryptocurrency market cap fell 0.3% to $867 billion at 8:05 p.m. EST.
| Coin | 24-hour | 7-day | Price |
|---|---|---|---|
| Bitcoin BTC/USD | 0.4% | 5.6% | $17,832.16 |
| Ethereum ETH/USD | -0.75% | 6% | $1,309.34 |
| Dogecoin DOGE/USD | -3.15% | -7.8% | $0.09 |
| Cryptocurrency | 24-Hour % Change (+/-) | Price |
|---|---|---|
| THORChain (RUNE) | +2.7% | $1.46 |
| Solana (SOL) | +2.4% | $14.19 |
| TRON (TRX) | +1.8% | $0.0.56 |
See Also: Is Binance Better Than Coinbase?
Why It Matters: The Federal Reserve raised its target fed funds rate by 0.5% on Wednesday to between 4.25% and 4.5%, which was in line with Wall Street’s expectations.
The Federal Open Market Committee members do not see a pivot from rate hikes to cuts until 2024, according to a prior report.
“We may have to raise rates higher to get where we want to go,” said Fed Chair Jerome Powell on Wednesday.
“The Fed did not welcome the disinflation trends that have just started to emerge and focused on robust job gains and elevated inflation. Any hopes of a soft landing disappeared as the Fed seems like they are committed to taking rates much higher,” said Edward Moya, a senior market analyst at OANDA.
“Bitcoin pared gains after the Fed delivered a smaller rate rise than recent meetings but signaled that ‘ongoing increases’ are likely appropriate. Cryptos are getting dragged down as the dollar rallies with the return of risk aversion,” said Moya, in a note seen by Benzinga.
The S&P 500 and Nasdaq closed 0.6% and 0.8% lower, respectively, on Wednesday. At the time of writing U.S. stock futures rose slightly. Major cryptocurrencies were seen trading lower with Bitcoin largely flat.
Michaël van de Poppe said the reaction to the rate hike has been “boring.” He said the dollar index, a measure of the greenback’s strength against six other currencies, has given back its entire bounce.
Bitcoin “had a large run, to the upside, bit overextended and into [high-timeframe] resistance. Probably seeking for HL on the markets and then we’ll continue the uptrend,” said the trader.
Bitcoin will see some consolidation as it seeks a higher low. The area to hold remains $17,200 to $17,400, according to Van de Poppe. He said the path towards $20,500 is open in 2-4 weeks.
Market intelligence platform Santiment noted that cryptocurrency platform topics such as “inflation” and “recession” hit their 4th highest spike ever in wake of the FOMC meeting and the interest rate hike.
A CryptoQuant analyst contrasted the position of Binance and FTX in a Twitter thread. Binance “has always been pretty transparent with cold wallets. FTX never was – never even had identifiable cold wallets. there’s a world of difference between the two,” said the analyst.
Delphi Digital noted that over the past two days the total value in the on-chain wallets of Binance has fallen from $65 billion to $60 billion as the exchange saw outflows of more than $5 billion.
Total Value In Binance On-Chain Wallets — Courtesy Delphi Digital
“As the U.S. Congress holds hearings over the FTX collapse, concerns regarding Binance have been growing, leading to an increase in withdrawals,” said the independent boutique data platform.
