Crypto turnaround: Market remained green despite Fed, BoE rate hikes
The crypto market remained in the green last week despite interest rate hikes by the US Federal Reserve (Fed) and the Bank of England. Both central banks raised their benchmark interest rates by 25 basis points (bps) to contain inflation. Despite that, the crypto market capitalization was up from $1.14 trillion on March 17 to $1.17 on Friday.
Bitcoin was up 5 percent to trade at $28,051, according to CoinMarketCap. Ethereum was up 2.7 percent at $1,788 on Friday.
“Throughout this week, Bitcoin has largely stayed above the $28,000 level. It initially started trading above this mark over the weekend and rose ahead of the US Federal Reserve’s FOMC meeting on interest rates. However, following the announcement, its value fell to $27,000. Nevertheless less, on Thursday, it quickly bounced back as investors surged, pushing the value back up to over $28,000,” said Alankar Saxena, CTO and co-founder of crypto firm Mudrex.
“Last week witnessed a continuation of the decoupling between crypto and traditional finance, as crypto asset prices marched higher even as US regional banks were hit hard and European giant Credit Suisse was bailed out via a merger with UBS. In another major macro development, The Fed hiked interest rates by another 25 bps, leading to a brief rally in stocks and some selling pressure on Bitcoin. But over the course of the week, broader crypto markets rallied strongly with Bitcoin leading the charge and crossing the crucial $28,000 mark,” said Parth Chaturvedi , leader of the crypto ecosystem. on crypto exchange CoinSwitch.
Also read: The US is warning Coinbase for allegedly violating securities laws
Another important development in the crypto world during the week was the US Securities and Exchange Commission (SEC) notice to the crypto exchange Coinbase. The “Wells Notice” was issued regarding an undefined portion of the listed digital assets, staking service Coinbase Earn, Coinbase Prime and Coinbase Wallet after a “superficial investigation”.
The notice informs the company that civil enforcement measures are being taken against it. The Wells notice typically states the alleged violation of the securities laws and also specifies the remedies sought.
“We are confident in the legality of our assets and services and, if necessary, we welcome a legal process to provide the clarity we have advocated and to demonstrate that the SEC has simply not been fair or reasonable in its engagement . on digital assets,” Coinbase general counsel Paul Grewal said in response.
What can be expected now?
Markets are expected to remain volatile next week.
“The Fed may continue its moderate rate hike to address the health of the economy, and we can expect limited growth in the markets due to high borrowing costs,” said Dhruvil Shah, senior vice president (SVP) of technology at Liminal.