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Bitcoin Snap 2-Day Gains Ahead Of FOMC Minutes
By Laxmikant Khanvilkar
Virtual digital assets (VDA) took a breather over the last 24-hours, after rallying in the previous two sessions, as investors hunkered down before the minutes of the Federal Reserve’s June meeting. Adding pressure was the report of tighter global liquidity conditions emerging as a headwind moving forward.
BTC, the largest cryptocurrency by market capitalisation, has dropped below $31,000 mark and most recently was trading at $30,806.50, down 1.09%. Ethereum, the second largest cryptocurrency, too retraced lower towards $1.900. It last quoted 0.85% weak at $1,938.83.
Apparently, the investor focus was now squarely on the minutes of the Fed’s June meeting, for more cues on the path of U.S. interest rates. While the central bank had kept rates on hold last month, it had also flagged at least two more hikes this year, given that inflation still remains high. Simultaneously, of late, the widely-tracked fiat liquidity metrics, such as Fed net liquidity indicator and the global net liquidity indicator, have turned lower. Hence, analysts believe that “it would be unusual for BTC to be constructive”. Both liquidity measures are likely to decline further in coming weeks.
The bearishness has took its toll on the global crypto market cap decreasing 0.95% to reach $1.21 tn, over the last 24-hours. Similarly, the total crypto market volume dropped to $30.7 bn, down 18.34%. The total volume in DeFi is currently $2.6 bn and that of all stablecoins is now $27.78 bn, representing 8.47% and 90.48% respectively, of the total crypto market 24-hour volume. Bitcoin’s dominance is currently 49.61%, a decrease of 0.02% over the day.
IC15 index, the barometer of top fifteen tokens, lost 0.67% to 40,596.
Elsewhere, the supply of bitcoin and ether on exchanges fell in June as ramped-up regulation and crime persuaded holders to prefer self custody, Goldman Sachs (GS) said in a report Tuesday, citing on-chain data.
So, some soggy tone for crypto traders today amid alerts to stay cautious ahead of FOMC minute release and tighter global liquidity conditions.
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