Bitcoin, Ether Consolidate As Rate Hike Fear Loom
By Laxmikant Khanvilkar
Virtual digital assets or VDAs continue to gyrate in narrow range over the last 24-hours after having entered a period of consolidation and a healthy correction after recent surge to several month high, analysts said.
Bitcoin (BTC) is recently hovering near $27,500 mark. The largest cryptocurrency by market capitalization slid in the last two sessions after spending most of the previous week above $30,000. At one point, bitcoin was changing hands near $27,100.
BTC’s recent price drop can be interpreted as “a period of consolidation and a healthy correction after an explosive move upwards past $30,000 over the last several months,” Sam Callahan, an analyst at bitcoin financial services firm Swan Bitcoin, told CoinDesk.
Market participants seem to be exercising some caution in light of the heightened probability of the Federal Reserve maintaining interest rates higher for longer, as well as several economic metrics signaling weakness in the economy, he added.
Investors are focusing next week’s Federal Open Market Committee (FOMC) meeting. The CME FedWatch Tool currently shows a 91% probability of the U.S. central bank raising interest rates 25 basis points (bps).
Ether (ETH), the second-largest cryptocurrency by market value, was changing hands around $1,841.
Over the past week, BTC and ETH have sunk 7% and 11%, respectively.
The global crypto market cap eased 0.20% to $1.16 tn, over the last 24-hours.
The total crypto market volume increased 28.62% to $38.37 bn. DeFi volume is currently at $3.13 bn, which is 8.17% of the total crypto market volume. Stablecoins volume account for 89.85% or $34.48 bn of the total crypto market volume.
Bitcoin’s dominance is currently 45.91%, an increase of 0.07%.
Meanwhile, analysts continue to back BTC as an asset class without counterparty risk and enjoying more compelling value proposition amid the turmoil recently experienced in the banking sector. A confirmation to the BTCs price prospect was provided by Citi Bank report as well. Crypto data firm Kaiko noted in a Monday report that despite the recent price drop, the BTC-to-gold ratio continued to head north last week, with one BTC as compelling investment option equalling 14.7 ounces of gold in early April, up from 9 ounces at the beginning of the year.
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