As anticipated, the U.S. Federal Reserve increased rates by 25 basis points. Fed Chair Jerome Powell indicated that the ongoing rate hikes might “no longer” be appropriate to control inflation, potentially signaling a pause in the rate rise cycle. Despite this, the central bank reiterated its commitment to lowering inflation, predicting at least one more rate increase and ruling out any interest rate cuts for 2023.
Holger Zschaepitz, senior editor at the Economic and Financial desk of the German daily Die Welt, viewed the Fed’s decision as somewhat dovish. Instead, market commentator Tedtalksmacro regarded Powell’s focus on inflation as hawkish, prioritizing it over the banking crisis.
In the meantime, U.S. Treasury Secretary Janet Yellen confirmed that she has no plans for a broad deposit insurance increase. This statement caused U.S. stocks to decline, as some traders believed such an action was an “irreversible accomplishment” that might play a role in preventing deposits from fleeing small or weaker banks.
Later on, the U.S. SEC announced that it had charged Justin Sun, a prominent crypto entrepreneur, as well as his companies Tron Foundation, BitTorrent, and Rainberry Inc. with conducting an unregistered sale of “crypto assets securities.” Sun and his companies allegedly incentivized celebrities to promote Tron and Bittorent without disclosing compensation, as per the authorities.
But the story about Sun and his trouble partly faded following the SEC’s controversial Wells notice to Coinbase over concerns about alleged “securities violations.” Coinbase responded to the notice by producing documents and providing witnesses, but its representatives said that the lack of clear regulatory guidelines has created confusion in the industry regarding compliance.
The crypto community is blown out by the SEC’s enforcement actions without clear rules. Jake Chervinsky, Chief Policy Officer at Blockchain Association, expressed his disappointment regarding the Wells notice sent to Coinbase. This is due to the fact that the firm had devoted a “significant amount of time and resources” to obtain regulatory clarity from the SEC.
Other industry experts, such as crypto investor Scott Melker and Caitlin Long, founder and CEO of Custodia Bank, share similar views. Long warns that the SEC’s actions may drive legitimate crypto businesses out of the U.S. and fail to protect investors while questioning how the SEC allowed a company to IPO if it violated securities laws.
In light of growing concerns surrounding traditional finance, the crypto community is reportedly turning to Bitcoin as a means of protection. Luke Hoersten, the founder and CEO of Bitcoin derivatives exchange Bitnomial, stated that Bitcoin is now considered a secure store of value. This is due to people recognizing that investing in U.S. Treasury-backed cash deposits “can be risky.”
Hoersten noted that traders are shifting their funds into Bitcoin and utilizing futures and options to guard against fluctuations in price. This trend may be responsible for the notional open interest in Bitcoin exceeding $20 billion on Deribit yesterday. Luuk Strijers, the exchange’s chief commercial officer, suggested that Bitcoin is now functioning as a hedge for the traditional financial system, particularly the banking sector.
After the Fed’s decision to hike rates, cryptocurrency prices experienced an initial rise, pushing Bitcoin up to \(28,800, but quickly plummeted to \)26,700 then. Earlier that day, on-chain analytics firm Glassnode reported that short-term holders had realized roughly $292 million in profits, which could encourage them to sell.
Bitcoin (BTC)’s price has since recovered, with some remaining optimistic about its medium-term strength but analysts are closely monitoring its price movement in the coming days. According to FxPro markets analyst Alex Kuptsikevich, if Bitcoin breaks \(28,500, it could [reach](https://www.coindesk.com/markets/2023/03/23/bitcoin-inches-toward-28k-as-traders-see-260m-in-futures-liquidations/) \)30,000. However, he cautioned that a drop below $27,500 could nullify the bullish technical signal and lead to a correction.
CryptoQuant analyst BaroVirtual noted that there was a bearish crossover between the UTXO Age Bands of 6 million - 12 million and 12 million - 18 million, which typically indicates an early bullish signal. Nonetheless, he indicated that Bitcoin could climb to \(30,000-\)33,000, or even \(37,000-\)40,000, before a substantial sell-off occurs.
At present, Ethereum (ETH) is experiencing a downward trend in comparison to Bitcoin, as indicated by the ETH/BTC pair recording a decline of -7.5% on a monthly basis and -6.66% on a weekly basis, hitting its lowest point since July 2022 at 0.0637. Despite this, there is a possibility of a recovery as the three-day relative strength index (RSI) of the pair has fallen below 30, a level deemed “oversold” by technical analysts.
Significant volatility over the past 24 hours caused \(309.89 million to be [liquidated](https://www.coinglass.com/LiquidationData) on futures markets. BTC led the trend with \)136.66 million being wiped out, followed by ETH at $50.64 million.
The most-anticipated event today may be the Arbitrum’s ARB airdrop. However, due to extremely high demand, the Arbitrum Foundation website - where users can claim their tokens - was down for a while.
Meanwhile, due to Justin Sun’s trouble with regulators, the cryptocurrencies with ties to him experienced a sharp drop. Tron (TRX) and Huobi Token (HT) both joined the biggest losers list among the top 100 assets today.
Top altcoin gainers and losers
Fei USD FEI (+36.83%)
Litecoin LTC (+12.10%)
Dash DASH (+8.40%)
Conflux CFX (-10.78%)
Huobi Token HT (-9.28%)
TRON TRX (-8.76%)
NFT Market Map
Coin360 Daily Digest
Here’s a rundown of the major crypto market news from today.
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Disclaimer: None of the information here constitutes financial advice and market participants are advised to conduct their own research since cryptocurrencies are speculative assets with considerable risks.