The Dramatic Bearish Crypto Sentiment Continues

Bitcoin plummeted for much of Thursday, a day after US Federal Reserve Chairman Jerome Powell made hawkish statements, while the stock market also plunged, with some traders wagering that the central bank would hike borrowing costs more than four times this year. According to CoinDesk statistics, the biggest cryptocurrency by market valuation was going up for sale near $37,000 at the time of writing, up somewhat over the previous 24 hours but still significantly below its week-ago peak. Ether, the second-largest cryptocurrency by market value, was trading at around $2,400 at the time of writing. The majority of other prominent cryptocurrencies were in the red as well.

The US dollar has been gaining amid the negative crypto wave. According to TradingView, the US dollar currency index (DXY) was up 0.79 percent over the previous 24 hours to 97.2 at the time of writing. As CoinDesk has observed, a stronger dollar is generally unfavorable for bitcoin. In the past, Bitcoin and the dollar index have gone in different ways. Last July, this unfavorable correlation became more apparent. According to data provided by CoinDesk, bitcoin trading volume on major crypto exchanges fell from a day earlier to its lowest level this week.

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Instead of bitcoin, the unanticipated drama surrounding Wonderland, prominent decentralized finance (DeFi) platform, was at the center of the market & crypto Twitter. The name of Wonderland’s pseudonymous treasury manager was disclosed on Twitter as Michael Patryn, co-founder of QuadrigaCX, an infamous Canadian crypto exchange that cheated investors of more than $190 million, according to CoinDesk. The surprising news has shocked “Frog Nation,” a collection of protocols led via well DeFi developer Daniele Sestagalli that includes Wonderland. According to CoinGecko statistics, the price of wonderland (TIME) has dropped by more than 25% to $396 at the time of writing. The value of cryptocurrencies like SPELL, which are part of Frog Nation, has also dropped dramatically.

Over the last several days, Bitcoin’s price has failed to maintain a short climb from $32,900 to $39,000. On intraday charts, the cryptocurrency is trading in a narrow range, and technical indicators are mainly neutral in the short term.

Over the last few weeks, the price movement has stayed below a downward-sloping 100-day moving average on the four-hour chart, indicating heavy selling pressure. Given the continuous decline since November, oversold indications have so far accompanied modest price gains, indicating limited upside ahead. To consolidate the downturn, buyers will need to retain support between $30,000 and $37,000 for the time being. The hosts of “First Mover” spoke with Chico Bulhes, the Rio de Janeiro Municipal Secretary for Economic Development, on the city’s plans to designate 1% of its treasury reserves to cryptocurrency. The hosts chatted with Michael Sung of China’s Fudan University from Brazil to China. During the Beijing Winter Olympics next week, he discussed China’s digital yuan deployment and potential foreign reactions. A day after the Federal Reserve signaled a rate rise in March, Toroso Investments Chief Investment Officer Michael Venuto shared insight into the crypto markets. Nikhilesh De, CoinDesk’s Managing Editor for Global Policy and Regulation, also shared the most recent regulatory news.

“The economy’s trajectory is still determined by the virus’s progress. Progress on vaccines, as well as ease in supply limitations, are likely to promote ongoing growth in economic activity and employment, as well as a decrease in inflation. There are still threats to the economy, particularly new virus strains.” (According to the Federal Reserve) “Blockchains offer a fantastic chance to replace data silos between firms with standardized and integrated data,” says the author. (Paul Brody, Global Blockchain Leader at EY) “The United States has learned to adjust to the new world of varieties and is still producing.” (To the Wall Street Journal, S&P Global Ratings Chief U.S. Economist Beth Ann Bovino).

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