The Price of Bitcoin Surges Above $43,000, Resulting in Liquidations
The price of bitcoin has risen above the $43,000 mark, causing over $66 million worth of leveraged cryptocurrency positions to be liquidated. According to The Block’s Price Page, the world’s largest cryptocurrency saw a 1.8% increase in the past 24 hours, reaching $43,317 at 12:00 p.m. ET.
This surge in price led to the liquidation of approximately $15 million in bitcoin leveraged positions, as reported by Coinglass data.
Macro Conditions May Impact Bitcoin Halving
Although the excitement surrounding the approval of multiple spot bitcoin ETFs has faded since January, two significant events are expected to unfold in the BTC narrative: the upcoming halving in April and the potential start of the Federal Reserve’s rate-cutting cycle in May.
However, one analyst believes that macroeconomic conditions could dampen the impact of the halving. YouHodler Chief of Markets Ruslan Lienkha suggests that high rates in financial markets may postpone or level out the positive effect of the halving on bitcoin’s price.
Delay in Anticipated Fed Rate Cut
In an interview with CBS’ 60 Minutes, Federal Reserve Chair Jerome Powell announced that there would not be an earlier rate cut in 2024. Powell stated that they want to be more confident about inflation reaching 2%, which may not happen by the March meeting.
Lienkha adds that although market forecasts currently predict rate cuts in May, this date might change as market sentiment is highly influenced by investors’ emotions. He also suggests that capital inflow to risky assets will likely be limited and under pressure until at least mid-year.
Hot Take: Bitcoin’s Price Surge and Potential Impact of Macro Conditions
The recent surge in bitcoin’s price above $43,000 has resulted in significant liquidations of leveraged cryptocurrency positions. While the market awaits the upcoming halving in April and potential rate cuts by the Federal Reserve in May, some analysts believe that macroeconomic conditions could lessen the impact of these events on bitcoin’s price. High rates in financial markets may counteract the positive effect of the halving. Additionally, Federal Reserve Chair Jerome Powell’s announcement of no early rate cut in 2024 may lead to changes in market sentiment and forecasts. Capital inflow to risky assets is expected to remain limited and under pressure until at least mid-year.
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