Bitcoin and other major coins traded sharply lower on Thursday evening as the global cryptocurrency market capitalization fell 0.8% to $2 trillion.
|Piece of money||24 hours||7 days||Price|
|Bitcoin (CRYPTO: BTC)||-7.8%||-5.6%||$40,567.94|
|Dogecoin (CRYPT: DOGE)||-1.3%||-6.15%||$0.15|
|Cryptocurrency||% change over 24 hours (+/-)||Price|
See also: How to buy bitcoins (BTC)
Why is this important: A multitude of factors led to the decline of cryptocurrencies on Thursday. Geopolitical tensions on the Ukrainian border resurfaced, while the release of Federal Open Market Committee minutes brought attention back to potential rate hikes.
The S&P500 and NASDAQ ended Thursday down 2.12% and 2.88% at 4,380.26 and 13,716.72, respectively.
President Joe Biden is expected to issue a decree on cryptocurrency regulation next week. The executive order should direct agencies to study both cryptocurrencies and the central bank’s digital currency, according to a report from Yahoo Finance.
Edouard Moyaa senior market analyst at OANDA, said that “Wall Street has gone into full de-risking mode and Bitcoin is paying the price.”
“Bitcoin is the ultimate risky asset, and an invasion of Ukraine would keep crypto selling pressure an additional 10-15% in the near term,” the analyst said, in a note seen by Benzinga.
Moya noted, highlighting the news of Biden’s upcoming executive order, that the uncertainty for stablecoins is a “short-term negative for cryptos, but the overall long-term growth of the cryptoverse will adopt US regulations.”
Moya’s colleague Craig Erlam said in a note that $45,500 was a “major resistance barrier” for the apex coin.
“A break above here could be a very bullish development for bitcoin,” Erlam said.
Trader in cryptocurrency Justin Bennett tweeted that “everyone is going bearish again at support huh?”
— Justin Bennett (@JustinBennettFX) February 17, 2022
Pseudonymous analyst Kaleo urged caution on Twitter. He said, “It would be silly not to proceed with caution here.”
As much as I would like my optimism of last week to materialize, it would be foolish not to proceed with caution here.
This pattern has signaled a local top too many times since the downtrend began in early November.
If depressions break, look for 37.5 (HTF diagnostic retest) pic.twitter.com/OYIdbkP1X9
— KALEO (@CryptoKaleo) February 17, 2022
Digital Delphi said in a recent note that the Bitcoin hash rate — the total combined computing power used for mining and processing transactions on the network — has skyrocketed.
BTC Hash Rate (TH/s) — Courtesy of Delphi Digital
Since the hash rate plummeted last year after China imposed a mining ban, it has recovered – hitting 248 million TH/s this week. It’s the highest it’s ever been. The United States now accounts for the largest share of the global BTC hash rate at 35.4% as of August 2021, according to the cryptocurrency research firm.
“This means that the number of miners has increased even as some leave China. This spike could be the result of miners completing the migration of their farms from China to other countries and starting to operate again,” Delphi Digital wrote.
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