Jannah Theme License is not validated, Go to the theme options page to validate the license, You need a single license for each domain name.

Bitcoin falls sharply ahead of Fed meeting as investors weigh Binance woes

Standard Chartered predicts bitcoin could fall to $5,000 in 2023 as part of a study on potential market surprises next year.

Nurphoto | Getty Images

The price of Bitcoin fell sharply and suddenly earlier in the week as investors awaited a major policy decision from the Federal Reserve and digested concerns surrounding Binance.

Bitcoin was last down more than 3% at $29,198.15, according to Coin Metrics. Earlier, it fell to $28,995.02, its lowest level in more than a month.

The reason for the sharp drop is unclear, although the move coincided with a Wall Street Journal report that added to recent investor anxiety around Binance. In particular, CEO Changpeng “CZ” Zhao reportedly suggested in a private conversation in 2019 that Binance branches accounted for a portion of trading volume around the time the company launched its US trading arm. There are questions about whether this activity was a “wash trade” aimed at increasing volumes.

Binance is the largest crypto exchange in the world. The Securities and Exchange Commission sued her last month, and she is at the center of a Justice Department investigation that will likely end in a consent decree or settlement, CNBC previously reported. Federal prosecutors were weighing anti-money laundering violations and sanctions evasion charges, charges that would have made it difficult for Binance or founder Zhao to continue to obtain licenses to operate.

However, not everyone is convinced that a big step can be taken in the history of Binance.

“You could probably chalk it up to technicals or flows,” said Kelly Cox, an analyst at investment firm eToro. “$30,000 is a big deal, and it makes sense that Bitcoin investors feel more nervous around those levels. Recovery doesn’t always follow a straight line.”

Elsewhere, investors are also keeping an eye on what the Federal Reserve does after its two-day meeting ends on Wednesday.

“Bitcoin has continued to fluctuate in a narrow range for just over a week, and is likely to continue until the conclusion of this week’s FOMC meeting,” said Yuya Hasegawa, crypto market analyst at Japanese bitcoin exchange Bitbank. “The market has almost fully priced in another 25 basis point rate hike from the Fed this week and is watching closely to see if they are going to do another hike before the end of this year, as suggested in the FOMC’s previous economic outlook.”

The rate hikes have helped lower the price of Bitcoin over the course of 2022, which has already been filled with several negative catalysts for the industry. Despite bitcoin’s recent resilience and equity rally, recessionary concerns remain as traders weigh the delayed impact of rate hikes and recent signs of a slowing economy.

“We have yet to see personal consumption spending in June … and they are likely to be slow to decide whether to hold off on rate hikes until they have more data and are more confident that inflation is coming down,” Hasegawa added. “This means that the FOMC’s rate decisions from now on are likely to remain ‘live’ and Bitcoin may not break above the $31,500 mark for some time yet.”

— CNBC’s Rohan Goswami contributed to this report.

Source by [author_name]

Related Articles

Back to top button