Bitcoin Traders Deleverage Following Fed’s Steady Rate Outlook
Crypto traders are reducing leverage following the FOMC minutes indicating the Fed's intention to maintain steady rates until inflation improves. Yield on the 10-year Treasury decreased, and the dollar weakened. Key developments include:
- The CoinDesk 20 Index rose by 1.4%, with bitcoin up 1.2% within 24 hours.
- Czech National Bank Governor Ales Michl supports bitcoin as a reserve asset.
- Donald Trump claims to have ended Biden’s restrictions on Bitcoin and crypto.
- Bitcoin is experiencing declining demand and liquidity, leading to a potential pullback to $86,000 from its current price over $97,000.
- Open interest in bitcoin futures has fallen below $60 billion, down from nearly $70 billion in January.
- Aggregate open interest for Solana dropped from around $6 billion to approximately $4.3 billion.
Market players anticipate broader macroeconomic factors and geopolitical developments affecting market movements. Upcoming events include:
- Feb. 21: TON becomes exclusive blockchain for Telegram's Mini App ecosystem.
- Feb. 24: Ethereum's Pecta upgrade testing begins on Holesky testnet.
- Feb. 27: Launch of Solana-based L2 Sonic SVM mainnet.
Market highlights show:
- BTC marginally increased to $97,300.67.
- ETH rose to $2,738.90.
- Total open interest across centralized exchanges grew by 2.1% to $80.8 billion.
- BTC volatility in derivatives reached a monthly low at 28.43%.
In the context of crypto equities, notable performers included MicroStrategy (MSTR) closing at $318.67 and Coinbase Global (COIN) at $258.67. Spot BTC ETFs reported a net outflow of $64.1 million.
The Pi Network’s native token PI debuted at $1.70, peaked at $2.00 before dropping 50%. The network claims 60 million users but fewer than 1 million active wallets, raising liquidity concerns.
Recent analyses reveal shifts towards safer investments amid a cooling market phase, with attention shifting to macroeconomic indicators and geopolitical tensions.