OPINION
Market Rating Before FOMC MeetingJan 31
Crypto Market Gains Momentum
As the uninterrupted rise in Bitcoin continues for the third trading day, the descending trend lasted for the 3 months has ended in the cryptocurrency market.
Bitcoin had declined to 32 000, the lowest of the last 6 months, on January 24; however, it gained more than 11 percent on Friday after a short 10-day balancing movements and exceeded 40 000 threshold. The leading cryptocurrency, which completed yesterday's transactions with a gain of 6.13 percent around 44 000, also tested the critical 45 000 on the second trading day of the week.
2021 Performance
The third quarter of 2021 was completed under pressure with restrictions on cryptocurrency transactions in China and India, the leading countries in Asia. The cryptocurrency market, which has found support from the significant decline in investor stress in international markets since October, reached its historic peak, leaving behind the problems derived from the Asian regulators. During this period, Bitcoin set a record by reaching 68 827 and Ethereum also set a record by hitting 4 852.
The US Decisions on Cryptos
Gary Gensler, Chairman of the US Securities and Exchange Commission (SEC), stated before the Senate that platforms serving the cryptocurrency market will need to register with the SEC. In addition, Gensler pointed out that the SEC's pressure on digital assets will be the main focus in 2022.
On the other hand, the Federal Reserve published a report on the potential benefits and risks of issuing a digital currency. The report is the first step in the discussion on whether and how the central bank digital currency can improve and worsen the secure and effective domestic payment system.
The Attitude of Russia and the Protests in Kazakhstan
In its report, the Central Bank of Russia (CBR) recommended banning all trade and mining of cryptocurrencies on the grounds that they limit the country's monetary policy dominance, are used to finance terrorism, create risks to energy consumption and Russia's environmental plans.
On the other hand, in Kazakhstan, where protests turned violent after the government's energy price hike decisions, Kazakh authorities pulled the plug on the internet. With the disruption of activities in Kazakhstan, which is the second largest miner in the world, BTC was down to 32 000 USD.
Sliding Demand from Tech Companies and Tesla's Support
Following the FOMC meeting dated January 25 - 26, the Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent and to continue to reduce the monthly pace of its net asset purchases, bringing them to an end in early March.
While the Committee pointed to March for the first rate hike, Fed Chair Powell's cautious tone of communication also eased the stress on the markets. Afterwards, the US Department of Labor released nonfarm payrolls data as 467k. Tripling the market forecasts, the data led to strong rise in technology shares on the New York stock exchange.
Taking its first support from technology companies on Nasdaq stock market around 38 000, BTC exceeded 40 000 USD on Friday following Tesla's 2021 10-K annual report filed with the SEC late Friday. Noting that they invested 1.5 billion USD in Bitcoin in the first quarter of 2021, Tesla noted that as of the end of the year, there was a total investment of 1.99 billion USD in Bitcoin.
Yesterday, the cryptocurrency market again exceeded the value of 2 trillion USD when Valkyrie's Bitcoin Mining ETF received approval from the SEC to be listed on the Nasdaq index, which includes US technology shares.
Bitcoin, which leads the cryptocurrency market, saw the critical 45 000 threshold for the first time since January 5 in today's quotations, while Ethereum, the second most popular cryptocurrency, also accompanied the rise, recovering the losses of the last 19 days. The daily earnings of SHIB and SLP exceeded 50 percent.
40 000 will set the tone in BTC
On the second trading day of the week, there is a high level of investor risk appetite in international markets. There is a bullish trend among instruments and settling above 40 000 will be very critical for Bitcoin.
Persistence in this region can activate the FOMO effect, which is often heard in the cryptocurrency market, and trigger a movement towards 46 900 and 50 000 USD. However, negotiations on stablecoins with cryptocurrency miners on February 10 and 15 in the US Senate should be followed closely.
Bitcoin had declined to 32 000, the lowest of the last 6 months, on January 24; however, it gained more than 11 percent on Friday after a short 10-day balancing movements and exceeded 40 000 threshold. The leading cryptocurrency, which completed yesterday's transactions with a gain of 6.13 percent around 44 000, also tested the critical 45 000 on the second trading day of the week.
2021 Performance
The third quarter of 2021 was completed under pressure with restrictions on cryptocurrency transactions in China and India, the leading countries in Asia. The cryptocurrency market, which has found support from the significant decline in investor stress in international markets since October, reached its historic peak, leaving behind the problems derived from the Asian regulators. During this period, Bitcoin set a record by reaching 68 827 and Ethereum also set a record by hitting 4 852.
The US Decisions on Cryptos
Gary Gensler, Chairman of the US Securities and Exchange Commission (SEC), stated before the Senate that platforms serving the cryptocurrency market will need to register with the SEC. In addition, Gensler pointed out that the SEC's pressure on digital assets will be the main focus in 2022.
On the other hand, the Federal Reserve published a report on the potential benefits and risks of issuing a digital currency. The report is the first step in the discussion on whether and how the central bank digital currency can improve and worsen the secure and effective domestic payment system.
The Attitude of Russia and the Protests in Kazakhstan
In its report, the Central Bank of Russia (CBR) recommended banning all trade and mining of cryptocurrencies on the grounds that they limit the country's monetary policy dominance, are used to finance terrorism, create risks to energy consumption and Russia's environmental plans.
On the other hand, in Kazakhstan, where protests turned violent after the government's energy price hike decisions, Kazakh authorities pulled the plug on the internet. With the disruption of activities in Kazakhstan, which is the second largest miner in the world, BTC was down to 32 000 USD.
Sliding Demand from Tech Companies and Tesla's Support
Following the FOMC meeting dated January 25 - 26, the Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent and to continue to reduce the monthly pace of its net asset purchases, bringing them to an end in early March.
While the Committee pointed to March for the first rate hike, Fed Chair Powell's cautious tone of communication also eased the stress on the markets. Afterwards, the US Department of Labor released nonfarm payrolls data as 467k. Tripling the market forecasts, the data led to strong rise in technology shares on the New York stock exchange.
Taking its first support from technology companies on Nasdaq stock market around 38 000, BTC exceeded 40 000 USD on Friday following Tesla's 2021 10-K annual report filed with the SEC late Friday. Noting that they invested 1.5 billion USD in Bitcoin in the first quarter of 2021, Tesla noted that as of the end of the year, there was a total investment of 1.99 billion USD in Bitcoin.
Yesterday, the cryptocurrency market again exceeded the value of 2 trillion USD when Valkyrie's Bitcoin Mining ETF received approval from the SEC to be listed on the Nasdaq index, which includes US technology shares.
Bitcoin, which leads the cryptocurrency market, saw the critical 45 000 threshold for the first time since January 5 in today's quotations, while Ethereum, the second most popular cryptocurrency, also accompanied the rise, recovering the losses of the last 19 days. The daily earnings of SHIB and SLP exceeded 50 percent.
40 000 will set the tone in BTC
On the second trading day of the week, there is a high level of investor risk appetite in international markets. There is a bullish trend among instruments and settling above 40 000 will be very critical for Bitcoin.
Persistence in this region can activate the FOMO effect, which is often heard in the cryptocurrency market, and trigger a movement towards 46 900 and 50 000 USD. However, negotiations on stablecoins with cryptocurrency miners on February 10 and 15 in the US Senate should be followed closely.
