Bitcoin Above $22K, Fed Hints At Bigger Rate Hike
By Laxmikant Khanvilkar
Bitcoin, the largest cryptocurrency, has managed to hold key threshold level of $22,000 and has intact rebounded to current level of $22,200 after having succumbed to selling spree triggered by the U.S. Central Bank Chairman remarks in his two-day semiannual monetary policy testimony before Congress that inflation had remained unexpectedly high.
A flurry of jobs and price indicators have raised inflationary concerns anew.
Ether (ETH), the second-largest cryptocurrency, slid 1% in the past 24 hours to trade around $1,550.
Most other major cryptos were largely in the red, aligning with equities markets, which also wrestled with Powell’s remarks.
The prospect of a 50 basis point (bps) interest rate hike instead of a more dovish 25 bps now rests at over 70%, roughly the reverse of the probability last week, according to the CME FedWatch Tool.
Over the last 24 hours, the crypto market cap has decreased by 0.44%, amounting to a total of $1.02 tn. The total volume of crypto-related activity in this time frame has increased by a significant 26.97%, equating to $44.72 bn. Decentralized finance (DeFi) accounts for 8.28% of the total volume, while stablecoins make up 91.91% of the total. Bitcoin’s dominance has dropped 0.14%, bringing its share of the market to 42.15%.
Meanwhile, Federal Reserve Chairman Jerome Powell’s testimony at a hearing before the Senate Banking Committee on Tuesday, hoped that the Congress or lawmakers will step in to provide a “workable legal framework” for digital assets in the U.S.
In his remark he said “We’ve seen just a remarkable set of events in the crypto space”.
Underlying the need for regulating Crypto he said “We have to be open to the idea that – somewhere in there – there is technology that can be featured in productive innovation that makes people’s lives better”.
The central bank’s chairman said the Fed is sticking to its warnings that banks should be “quite cautious” about getting involved in digital assets.
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