About Bitcoin Ether and other top-10 cryptos down
Bridge2pay inform about Bitcoin Ether -Friday morning in Asia, Bitcoin fell and now trades below the US$27,000 support barrier. Ether also lost ground and, for the first time in the previous week, lost control of the US$1,600 level. The top 10 non-stablecoin cryptocurrencies all saw losses during the previous day. Solana was the biggest loser, falling more than 3%. As investors processed aggressive U.S. Fed comments on monetary policy, there was a decrease in global equity markets on Thursday, which corresponded with a decline in cryptocurrency prices. Following losses of more than 1.0% on Thursday for all three of the main U.S. indexes, U.S. stock futures were trading flat during the Asian trading session.
Cryptos drop as US bond yields soar
According to data from Cornmarket Cap, the price of bitcoin dropped 2.10% during the last 24 hours to US$26,580.90 as of 7:30 a.m. in Hong Kong. On Thursday night, the value of the biggest cryptocurrency in the world dropped to US$26,389.30, the lowest point in a week.
The U.S. Federal Reserve forecast one more rate increase by the end of 2023 after making the anticipated decision to leave interest rates constant in September. Although it revised down its forecast for the rate of interest rate decreases in 2024, Fed members’ remarks were “more hawkish” than experts had anticipated.
According to John Stefanidis, CEO of blockchain infrastructure company Balthazar DAO, “the decline in most tokens this morning may reflect investors’ cautious approach as they carefully consider the implications of the Federal Reserve’s recent interest rate remarks.”
Furthermore, Stefanidis noted that the spike in 10-year U.S. Treasury rates to 16-year highs “could have played a role in reshaping market dynamics.”
Standard 10-year U.S. Treasury rates increased to a 16-year high of 4.49% on Thursday following the Fed meeting on Wednesday.
“U.S. equity and rates markets have broken some very key levels on the back of this (Fed projection), and reflexivity can take over with the bearish thesis from here,” noted digital asset trading company QCP Capital in a Thursday Telegram market report.
Despite having a smaller beta compared to other severely stretched macro markets like the NASDAQ, the decline in stock markets and increasing government rates “could seep into crypto markets and take BTC lower with it,” according to QCP Capital.
The several spot Bitcoin exchange-traded fund (ETF) applications being considered in the United States, despite macro challenges, can help Bitcoin, according to Markus Thielen, head of research and strategy at digital asset service platform Matrix port.
Pricing of Bitcoin & Others –
The price of Bitcoin may change immediately and go up by 20% in an instant if the SEC authorizes a Bitcoin ETF, which we predict has a 70% chance of happening in the next six months. Therefore, maintaining upside exposure to such an occurrence is crucial. Thielen said in an emailed comment.
The price of ether decreased 2.35% to US$1,585.53 and was down 2.66% for the week. For the first time since last Thursday, the second-largest cryptocurrency in the world dropped below the US$1,600 support barrier.
The top 10 non-stablecoin cryptocurrencies all saw losses during the previous day. The biggest loss was Solana’s SOL, which dropped 3.73% to US$19.54. It nonetheless had a weekly gain of 3.5%.
Statement –
According to a statement released on Thursday by Mt. Gox trustees, the defunct Tokyo-based cryptocurrency exchange Mt. Gox has extended the deadline for paying back its clients from October 2023 to October 2024.
Mt. Gox, the biggest cryptocurrency exchange in the world at the time, had over 850,000 Bitcoins stolen from it in 2014. These coins are now valued approximately US$22.57 billion. About 142,000 Bitcoins are now held by the cryptocurrency exchange. Analysts predict that the wider Bitcoin market will see selling pressure as a result of the consumers of Mt. Gox receiving their stolen Bitcoin back.
According to Justin d’Anethan, head of Asia-Pacific business development at Belgian cryptocurrency market maker Keyrock, “(Mt. Gox’s delay) alleviates—at least for now—a wave of selling that many traders must have been preparing for and that can now be ignored.”
Additionally, less than a year after announcing it would phase out the practice, Tether Holdings, the company that creates the USDT stablecoin, increased the scope of its USDT loan services during the most recent financial quarter.
“Most investors and holders would see that as additional risk, as it means more assets will be used by third parties and, if market conditions were to turn for the worse, could pose liquidity issues,” d’Anethan said.
At 07:30 a.m. in Hong Kong, USDT was trading at US$1.0001, just above its 1:1 peg to the greenback. According to d’Anethan, the valuation indicates that “investors are not concerned and actually prefer it to most other stablecoin options.
While trade volume increased 158.64% to US$72.41 billion in the last day, the overall market value of cryptocurrencies fell 1.67% to US$1.05 trillion.
No indication of a downturn in the US economy; BOJ continues its monetary easing
As of 9:30 a.m. in Hong Kong, U.S. stock futures were trading unchanged. Thursday’s closing price on Wall Street was lower, with the Nasdaq Composite leading the losers with a 1.82% decline. Losses of more than 1% were recorded by the S&P 500 and Dow Jones Industrial Average as well.
On Thursday morning, the majority of the major Asian market indices were down. Losses were recorded by the Hang Seng in Hong Kong, Nikkei 225 in Japan, and Kospi in South Korea. With a loss of 0.92%, the Kospi was the biggest loser, while China’s Shanghai Composite gained just 0.05%.
Following the Federal Reserve’s strong stance on monetary policy at its September meeting on Wednesday, the equity markets fell. Fed members predicted that the interest rate will rise by another 25 basis points over the next year, reaching 5.6% by the end of 2023. In a further indication that it plans to maintain rates higher for longer, the Fed increased the expected median interest rate by the end of 2024 from 4.6% to 5.1%.
Former Federal Reserve Bank –
Former Federal Reserve Bank of St. Louis President James Bullard told Bloomberg on Thursday that the Fed may need to increase interest rates further “to make sure that core inflation especially continues to come down at an appropriate pace so the committee can get back to 2% inflation in a reasonable time frame.”
Bullard added, “The chances of a gentle landing are excellent, but you haven’t landed until you have inflation back to 2%. The core consumer price index (CPI) in the United States increased 4.3% from the previous year in August, which was the lowest increase in over two years.
Economic Indicators –
In terms of economic indicators, the first claims for unemployment insurance in the US fell to 201,000 in the week ending September 16. The data represents the lowest level since January and is less below the expert prediction of 225,000. The information may increase the Fed’s hawkishness on monetary policy.
Christopher Rupkey, chief economist at FWDBONDS in New York, told Reuters on Friday that the economy was “just not showing any sign of slowing down” and that this suggested that inflation would not be returning to the target range. “It now appears that another rate hike is justified, and the Fed was wise to keep another interest rate hike in their back pocket just in case.”
Upcoming Interest –
To decide its upcoming interest rate decision, the Fed will meet on November 1. The likelihood of no interest rate increase in November has increased from 71.6% on Thursday to 73.8% according to the CME FedWatch Tool. Additionally, it predicts a 54.8% chance—up from 53.4% on Thursday—of another halt in December.
Expiration –
A temporary export embargo on fuel and gasoline was also imposed by Russia on Thursday, with no expiration date given. Diesel prices increased throughout Europe as a result of the statement.
Despite the embargo being only temporary, Alan Gelder, vice president of refining, chemicals, and oil markets at international consultancy firm Wood Mackenzie Ltd., told Bloomberg on Thursday that it will have a big impact because Russia continues to be a major supplier of diesel to international markets.
When global diesel stockpiles are already at low levels, Gelder continued, “the global refining system will struggle to replace those lost Russian volumes.”
Announcement – Central Bank of Japan
The central bank of Japan made its own announcement about interest rates on Friday. The ultra-loose monetary policy of the Bank of Japan will remain in place. This comprises a target short-term interest rate of -0.1% and an actual yield ceiling on 10-year bonds of 1.0%.
