Bitcoin price reacts more strongly to FTX moves than to macro events

According to the research, the failure of FTX and related developments will have a greater impact on the price of Bitcoin in the fourth quarter of 2022 than macroeconomic events such as interest rate hikes.

In the report “The State of Bitcoin Q4 2022” Announce On Feb. 10, Messari research analysts Sami Kassab and Chris Collar found that the exchange’s crash caused a 25 percent drop in bitcoin prices.

“How will Bitcoin perform in Q4 2022 after an unfavorable crypto and macro environment?

+ The crash of FTX caused a 25% swing, affecting the balances of centralized entities/exchanges.

After the halving trend, the year-on-year performance fell by 64%.

+ Active addresses increased by 2% month-on-month.

The report highlights that changes in the federal funds rate have a much smaller impact on bitcoin prices, even after increases of 75 and 50 basis points.

On the other hand, the number of active wallets increased by 2% month-on-month as Bitcoin moved from centralized exchanges to self-custodial wallets during the period.

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one article Research from the New York Fed earlier this week came to the same conclusion.

The Feb. 8 article examines the link between macroeconomic news and bitcoin prices and finds that inflation isn’t the only variable that has a significant impact on bitcoin prices.

Authors, research analysts Gianluca Benigo and Carlo Rosa compiled data from January 2017 to December 2022 to examine the impact of macroeconomic news on different asset classes.

The study considered multiple news categories, including inflation, the real economy, monetary policy and various forward-looking indicators.

The authors expressed surprise at their findings and concluded:

“Unlike other U.S. asset classes, the results show that Bitcoin is not highly correlated with macroeconomic and currency news. This scatter data is confusing because in principle unexpected changes in the discount rate should affect the price of Bitcoin, even if The same goes for understanding it as a purely speculative asset.”

Even as the Federal Reserve continues to raise interest rates at a record pace, bitcoin is off to a strong start in 2023, rising by nearly a third to $21,888 from $16,557.

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As reported by Cointelegraph

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