Bitcoin Jumps Above $24,000 Leading Crypto to Rise as US Acts to Support Banks

Bitcoin continued to gain momentum in Tuesday morning trading in Asia after yesterday’s rebound as regulators moved to prop up the US banking industry following a setback in California lenders, which also helped restore parity with the USDC stablecoin. Most of the top 10 non-stablecoin cryptocurrencies have risen. However, US stocks closed on Monday mixed on bank failures, while speculation grew that banking problems could lead the Federal Reserve to put on hold plans to raise interest rates.

See related article: According to Circle’s Disparte, banks create systemic risks for cryptocurrencies.

Fast Facts

  • Bitcoin is up 7.21% in the last 24 hours to $24,251 at 09:00 AM in Hong Kong, according to data from CoinMarketCap. The world’s largest cryptocurrency is up 8% in the past seven days after clearing losses earlier in the month when crypto-related bank Silvergate crashed and triggered a sell-off in the crypto market.

  • Ether is up 3.08% to $1,673, gaining 6.84% over the past seven days.

  • Cryptocurrency exchange Binance’s BNB token jumped 5.09% to $308.94, ranking second in the top 10 by market capitalization and gaining 7.06% over a seven-day period. Binance CEO Changpeng Zhao tweeted On Monday, Binance will convert its $1 billion Industry Recovery Initiative funds from BUSD into cryptocurrencies including BNB, Bitcoin, and Ether, offering support in the crypto market given fluctuations in stablecoins and banks.

  • USD Coin (USDC), the second-largest stablecoin by market capitalization that briefly lost its peg to the US dollar over the weekend, rebounded to $0.9987, according to CoinMarketCap data. Circle, the issuer of USDC, announced a new partnership with New Jersey-based Cross River Bank on Monday following the closure of Silicon Valley Bank.

  • XRP fell 1.26% to $0.3715 and led the losing streak but was still trading up 0.73% for the week. Cryptocurrency transaction tracker Whale Alert informed wave of large XRP transactions on Monday totaling over 916 million XRP.

  • The total capitalization of the crypto market has grown by 4.61% over the past 24 hours to $1.08 trillion. Total trading volume over the past 24 hours has increased by 35.57% to $93.65 billion.

  • US stock markets closed mixed on Monday. The Dow Jones Industrial Average fell 0.28%, the S&P 500 fell 0.15% and the Nasdaq Composite rose 0.45%.

  • U.S. bank stocks have been hit hard despite assurances from U.S. regulators and President Joe Biden that deposits are protected. Shares in San Francisco-headquartered First Republic bank fell more than 60% and were briefly put on hold, according to CNBC.

  • Until March rolled around with its banking problems, investors were focused on what the size of the next Fed interest rate hike to slow inflation would be. But troubles with banks have fueled speculation that the Fed may put the policy on hold. Goldman Sachs said the Fed is unlikely to raise rates at its next meeting on March 22, reversing its previous forecast of a 25 basis point hike, Reuters reported on Monday.

  • The key indicator of inflation this week is the February US Consumer Price Index (CPI), released by the Department of Labor on Tuesday. The Reuters poll forecasts CPI to rise 0.6% m/m and 6% y/y, down from 6.4% for the year ended January 2023, but still well ahead of the Fed’s stated goal of keeping annual inflation below 2. %.

  • CME Group analysts expect the Fed to raise rates by 25 basis points this month with a 65.0% chance. The chance of not raising the rate is 35%.

  • US interest rates range from 4.5% to 4.75%, the highest since October 2007.

See related article: Circle USDC Stablecoin Recovers Parity as Regulators Take Action to Avert Bank Failure Risk

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