Bitcoin tracks equities lower on hawkish Fed outlook

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Bit­coin fell on Thurs­day morn­ing in Asia along with most oth­er top 10 non-sta­ble­coin cryp­tocur­ren­cies. XRP led the losers, while Lite­coin gained. U.S equi­ties fell after the Fed­er­al Reserve raised inter­est rates as expect­ed on Wednes­day but lat­er said rates could be high­er for longer, while the Trea­sury backed away from a blan­ket back­stop for trou­bled banks. Adding to cryp­to con­cerns is a law­suit against cryp­to entre­pre­neur Justin Sun and a warn­ing to the Coin­base exchange about some of its stak­ing products.

See relat­ed arti­cle: Bit­coin buoyed as bank busts spook investors

Fast facts

  • Bit­coin dropped 2.53% in the past 24 hours to US$27,355 at 09:00 a.m. in Hong Kong, but still held a gain of 12.55% for the past sev­en days, accord­ing to Coin­Mar­ket­Cap data. The world’s largest cryp­tocur­ren­cy reached a nine-month high of US$28,803 before the slide that fol­lowed the Fed’s lat­est rate hike and hawk­ish comments.
  • Ether dropped 2.85% to US$1,739, though is still up 5.6% over the sev­en days.
  • XRP was the biggest los­er in the 24 hours, slid­ing 8.66% to US$0.4219. How­ev­er, it also is still up on the week by 17.57% after a surge in recent days on opti­mism the SEC law­suit that involves the token is near­ing resolution. 
  • Lite­coin was the only top 10 non-sta­ble­coin cryp­tocur­ren­cy that logged gains for the past 24 hours. The token rose 6.07% to US$86.63 for a week­ly gain of 13.32%.
  • On Wednes­day, the U.S. SEC sued Justin Sun and three of his com­pa­nies – Tron Foun­da­tion Lim­it­ed, Bit­Tor­rent Foun­da­tion Ltd., and Rain­ber­ry Inc. (pre­vi­ous­ly known as Bit­Tor­ro) – for the sale and offer of Tron­ix (TRX) and Bit­Tor­rent (BTT), which were described by the SEC as unreg­is­tered “cryp­to asset secu­ri­ties”. It also charged the above with fraud and mar­ket manip­u­la­tion, and sued eight celebri­ties for ille­gal­ly pro­mot­ing TRX and BTT, includ­ing Lind­say Lohan and Jake Paul.
  • The U.S.-based cryp­to exchange Coin­base is fac­ing anoth­er poten­tial law­suit from the SEC after receiv­ing a Wells notice that said the exchange vio­lat­ed secu­ri­ties law, adding to the ongo­ing con­flicts between Coin­base and U.S. regulators.
  • The total cryp­to mar­ket cap­i­tal­iza­tion dropped 2.31% in the past 24 hours to US$1.15 tril­lion. Total trad­ing vol­ume over the last 24 hours edged up 1.75% to US$68.93 billion.
  • U.S. equi­ties closed low­er on Wednes­day. The Dow Jones Indus­tri­al Aver­age dropped 1.63%, the S&P 500 fell 1.65%, and the Nas­daq Com­pos­ite Index lost 1.60%. 
  • The Fed­er­al Reserve on Wednes­day raised its tar­get range for U.S. inter­est rates by the expect­ed 25 basis points to 4.75% to 5%, the ninth inter­est rate hike since March 2022.
  • The Fed reaf­firmed its goal to keep annu­al infla­tion below 2% and investors expect more rate hikes through the year, com­pared to ear­li­er spec­u­la­tion for a pause due to fail­ures and weak­ness in the bank­ing indus­try. The U.S. con­sumer price index (CPI) rose 6% on year in Feb­ru­ary, a decel­er­a­tion from 6.4% in Jan­u­ary, but still well above the Fed’s 2% goal.
  • Adding to con­cerns, U.S. Trea­sury Sec­re­tary Janet Yellen told a Sen­ate Appro­pri­a­tions sub­com­mit­tee that she had not con­sid­ered or dis­cussed a “blan­ket insur­ance or guar­an­tees” of all U.S. bank deposits, accord­ing to Reuters.
  • Ahead of the open­ing of U.S. equi­ty mar­kets on Thurs­day, U.S. stock futures edged slight­ly high­er as of 9:00 a.m. in Hong Kong. The Dow Jones Indus­tri­al Aver­age futures moved up 0.15%. The S&P 500 futures gained 0.12%. The Nas­daq Com­pos­ite Index gained 0.09%.

See relat­ed arti­cle: Inter­nal Rev­enue Ser­vice in U.S. solic­its pub­lic opin­ions on pro­posed NFT taxes

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