Bitcoin soared 8.8% on
Wednesday, ending the day around $41.9K. Apparently, the benchmark
cryptocurrency experienced clear problems with growth above $42K. On Thursday
morning we see an equally strong reversal move back to $39K. As a result,
Bitcoin lost 5.6% in 24hours Ethereum - 4.8%, other leading altcoins from the
top ten are declining from 1% (Terra) to 7.2% (Avalanche).
According to CoinMarketCap, the total capitalization of the crypto market
decreased by 4.5% over the day, to $1.75 trillion. The Bitcoin Dominance Index
dropped from 43.0% to 42.7%. The Cryptocurrency Fear and Greed Index added 6 points to 28, climbing into
“fear” territory.
Bitcoin's growth momentum was also supported by the positive dynamics of stock
indices, however, on Thursday morning, the positive pull on them remains in
contrast to the sell-off of cryptocurrencies.
Bitcoin jumped when a statement by Janet Yellen appeared on the website of the
US Department of the Treasury, which does not contain strict measures to
control the field of cryptocurrencies. The statement was posted, probably
prematurely, and then quickly removed from the site.
Later on Wednesday, US President Joe Biden signed the first executive order to
regulate cryptocurrencies in the country. The document contained only the most
general provisions, such as consumer protection, financial stability,
technology development and the illegal use of cryptocurrencies. More specific
measures in the field of control over the digital asset market will be
developed by individual federal departments.
In our opinion, the States are making it clear that they will not allow cryptocurrencies to become a shadow business and be used to circumvent sanctions, taxes, money laundering and similar things. Such control is more difficult to implement than with centrally issued fiat money.
This article was written by FxPro’s Senior Market Analyst Alex Kuptsikevich.
