Bitcoin continues to rise as the Fed pumps money back into the US financial industry

The world’s largest cryptocurrency Bitcoin surges to new 2023 highs thanks to macro news coming from the Fed.

Price movement of top cryptocurrencies in the market at 06:40 PM on 17/03/2023. Source: Coin360

On the evening of March 17, Bitcoin (BTC) recorded a gain of more than 7% to $ 26,788, surpassing the peak of $ 26,368 of March 14 to set a new value record in 2023.

This is the highest value threshold of Bitcoin since mid-June 2022, when the market crashed because the Three Arrows Capital fund had liquidity difficulties and then went bankrupt.

Bitcoin in the last 7 days has had a spectacular growth momentum of up to 37%, from the bottom of $ 19,549 on March 10 to $ 26,788 on March 17.

1h chart of BTC/USDT pair on Binance exchange at 06:40 PM on 17/03/2023

BTC at this time a week ago was still being “beaten” from a series of bad news that hit the market at that time, from information about interest rates from the Fed President, the collapse of US banks. related to the crypto industry, news that the US imposes a 30% mining tax, Voyager sells assets, … and especially USDC depeg because of the Silicon Valley Bank bank run and could not continue to operate.

However, after the Fed and the US Department of Finance decided to intervene and rescue the bank, Bitcoin has continuously had strong rising days.

Most recently, data from the US Federal Reserve shows that the central bank of the world’s largest economy has pumped up to $ 300 billion to the financial world in just a few days. That amount is about half of the liquidity that was withdrawn by the Fed during 2022, a period of quantitative tightening and raising interest rates in response to inflation – which is also the result of the Fed printing money to save money. helping the economy not fall into a crisis because of the COVID-19 epidemic in the period of 2020-2021, increasing the money supply from 4 trillion to nearly 9 trillion USD in less than 2 years.

There have been many opinions that before the pressure of the chain collapse of the US banks, the Fed will be forced to delay the process of raising interest rates or at least slow down the rate of interest rate hikes in the upcoming meeting on the morning of 23/02. 03 (Vietnam time). There are scenarios that even confirm that this is the end of the agency’s quantitative tightening policy.

Having more USD on the market will cause the US dollar to depreciate against other assets like gold or cryptocurrencies, helping them to appreciate – which is happening right now.

Another news that also helped BTC go up was that Binance exchange announced earlier this week that it would convert its 1 billion BUSD bailout fund to BTC, ETH and BNB to avoid risks from stablecoins, especially when BUSD was warned by the US. In addition, the asset trustee of Mt. Gox continues to move the deadline for Bitcoin payments to April, causing the selling pressure of BTC in the market to partially ease.

The world’s second-largest cryptocurrency, Ethereum (ETH), is up slightly 5% to $1,749, unable to surpass the $1,780 peak of March 14.

1h chart of ETH/USDT pair on Binance exchange at 06:40 PM on 17/03/2023

Most other big cap altcoins are also only up 4-6%, indicating that the rally seen in the market is entirely led by BTC.

The liquidation rate in the last 12 hours was 88% short positions, with a total value of nearly 105 million USD.

The value of cryptocurrencies liquidated in the last 12 hours, data taken from Coinglass at 06:40 PM on 17/03/2023

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