- MicroStrategy spent $150 million to purchase an additional 6,455 Bitcoin and to settle debt with the bankrupt Silvergate.
- Following news that Binance and CZ were being sued by the CFTC, Bitcoin dropped under $ 27,000.
- First Citizens Bank agreed to buy $72 billion of Silicon Valley Bank’s (SVB) assets at a $16.5 billion discount, leaving the FDIC with about $90 billion of remaining assets.
- The L2 zkEVM mainnet was officially launched by Polygon, and the first transaction was made by Vitalik Buterin.
- The US government has 205,515 BTC ($5.8 billion) in confiscated criminal asset funds.
- Chinese state-owned banks are providing services to Hong Kong-based crypto companies as the city adopts a more accommodating regulatory stance.
- Fed raises interest rates by 0.25 percentage point to combat inflation. Despite the turmoil in the banking sector, Fed officials are now expecting one more rate increase this year.
The total value of the cryptocurrency market has stagnated at $1.2 trillion. The overall crypto market capitalization has been battling resistance at the $1.2 trillion level after increasing by 11% between March 16 and March 18. A shift in the Federal Reserve’s monetary policy is one factor contributing to positive short-term momentum. In order to make short-term loans to failing banks between March 9 and March 23, the U.S. Federal Reserve was compelled to expand its balance sheet by $393 billion. The plan’s goal was to lessen inflation, which has had a significant impact on living expenses and ultimately slowed down the United States’ economic growth.
The central bank’s trend of selling some of its debt instruments, exchange-traded funds, and mortgage-backed securities over the previous nine months is reversed by the reduction in the balance sheet. The Fed is providing a lifeline to struggling banks and hedge funds, so the strategy’s reversion initially favors risk assets.
However, the price of Bitcoin and other prevalent cryptocurrencies dropped on Monday after US regulators filed a lawsuit against Binance, the largest cryptocurrency exchange in the world, charging it with violating compliance regulations and selling illicit derivatives products. The CFTC charged Binance with running an illegal derivatives exchange for commodities it referred to as tokens like Bitcoin and Ethereum.
Following the announcement, Bitcoin dropped 3+% to $27,143.95 and Ethereum dropped 3+%. The native token of the exchange, Binance Coin (BNB), dropped 5+% while the value of the entire cryptocurrency market dropped by almost 3+%.
Addresses with Non-Zero Bitcoin Balances:
Data provided by crypto analytics company Glassnode shows that the number of Bitcoin wallets with a non-zero BTC balance is continuing to soar, reaching a new all-time high of 45+ million on Sunday. The Bitcoin network has added non-zero wallet addresses at this rate at the fastest rate since early 2021, an increase of over 2 million since the beginning of 2022. A higher percentage of wallets with a non-zero balance suggests that more investors are entering the Bitcoin market, or, put another way, that demand is continuing to increase, which is good news for the price of Bitcoin.
In contrast, a few other widely used indicators of activity on the Bitcoin blockchain have weakened recently as a result of Bitcoin’s failure to test $30,000 last week.
Bitcoin Price Analysis:
The bulls are still holding strong despite Bitcoin’s recent failure to rise above $29,000. They still haven’t let the price fall to the $25.00 breakout level. The BTC/USDT pair may quickly increase to $30,500 if bulls drive the price above $28,000. The bears could sell aggressively at this level. If the price drops below $25,000, this optimistic evaluation may become invalidated in the near future. A healthy dip may be required to stimulate new buyer interest at lower levels if BTC is unable to break through $28,000. As long as the BTC/USDT remains below $28,000, the short-term trend is currently somewhat bearish, and BTC may test the $25,500 support level.
Concluding Thoughts:
The CFTC suing Binance and its CEO, Changpeng Zhao, caused the cryptocurrency market to correct itself. Money has moved into investments deemed less risky as a result of the news and events surrounding the banking crisis in the US and Europe. There was a $280+ billion inflow into U.S. money market funds in March.
Some of the funds may have found their way into money market funds and the cryptocurrency market as well. One of the potential causes of the increased demand for Bitcoin in March is its strong performance. Whether the recovery will continue or if it’s time to book profits in Bitcoin is the key question on investors’ minds when it comes to cryptocurrencies. Bitcoin hodlers don’t appear to be being persuaded to sell their holdings after the recent rally because they are confident in the long-term outlook. Bitcoin and other cryptocurrencies may experience a short-term correction if the banking crisis is controlled, but if the legacy banking system continues to experience issues, Bitcoin may continue to draw investments.
