Bitcoin Holds Steady Near $27K as Debt Ceiling Developments Weigh on Investors in Asia

Bitcoin Holds Steady Near $27K as Debt Ceiling Developments Weigh on Investors in Asia


Despite government efforts, citizens in large emerging countries such as Pakistan and Nigeria are turning to digital assets as a hedge against struggling currencies and skyrocketing inflation, highlighting the growing demand for crypto assets amidst a lack of trust in centralized institutions.

ALSO: CoinDesk’s previous head of research writes that regardless of Government efforts in such large, emerging countries as Pakistan and Nigeria to curb cryptocurrency activity, citizens there appear to be turning to digital assets as a hedge.

Good morning. Here’s what’s happening:

Prices: Bitcoin (BTC) at $26.8K maintains its debt-ceiling holding pattern.

Insights: Cryptocurrency as a hedge? The citizens in two large, emerging countries and other major whole lot of economies appear to be turning to digital assets as their currencies struggle.

CoinDesk Market Index (CMI)

1,162

ey_Takeaways”>Key Takeaways => Main Points=”0-diff-returns-string” class=”diff-value”>+4.9 0.4 percent

Bitcoin (BTC) $26,866

ey_Takeaways”>Key Takeaways => Main Points=”1-diff-returns-string” class=”diff-value”>+108.3 0.4 percent

Ethereum (ETH) $1,819

ey_Takeaways”>Key Takeaways => Main Points=”2-diff-returns-string” class=”diff-value”>+13.9 0.8 percent

S&P 500

4,192.63

ey_Takeaways”>Key Takeaways => Main Points=”3-diff-returns-string” class=”diff-value”>+0.6 0.0 percent

Gold

$1,972

ey_Takeaways”>Key Takeaways => Main Points=”4-diff-returns-string” class=”diff-value”>−6.7 0.3 percent

Nikkei 225

31,086.82

ey_Takeaways”>Key Takeaways => Main Points=”5-diff-returns-string” class=”diff-value”>+278.5 0.9 percent

BTC/ Ethereum (ETH) prices per CoinDesk Indices, as of 7 a.m. ET (11 a.m. UTC)

CoinDesk Market Index (CMI)

1,162


ey_Takeaways”>Key Takeaways => Main Points=”0-diff-returns-string” style=”font-size:12px !important;float:left;margin-right:5px;color:#a3a3a3 !important”>+4.9 0.4 percent

Bitcoin (BTC) $26,866


ey_Takeaways”>Key Takeaways => Main Points=”1-diff-returns-string” style=”font-size:12px !important;float:left;margin-right:5px;color:#a3a3a3 !important”>+108.3 0.4 percent

Ethereum (ETH) $1,819


ey_Takeaways”>Key Takeaways => Main Points=”2-diff-returns-string” style=”font-size:12px !important;float:left;margin-right:5px;color:#a3a3a3 !important”>+13.9 0.8 percent

S&P 500

4,192.63


ey_Takeaways”>Key Takeaways => Main Points=”3-diff-returns-string” style=”font-size:12px !important;float:left;margin-right:5px;color:#a3a3a3 !important”>+0.6 0.0 percent

Gold

$1,972


ey_Takeaways”>Key Takeaways => Main Points=”4-diff-returns-string” style=”font-size:12px !important;float:left;margin-right:5px;color:#a3a3a3 !important”>−6.7 0.3 percent

Nikkei 225

31,086.82


ey_Takeaways”>Key Takeaways => Main Points=”5-diff-returns-string” style=”font-size:12px !important;float:left;margin-right:5px;color:#a3a3a3 !important”>+278.5 0.9 percent

BTC/ Ethereum (ETH) prices per CoinDesk Indices, as of 7 a.m. ET (11 a.m. UTC)

Boring Bitcoin (BTC) Slumbers Near $27K

Bitcoin (BTC) held comfortably in its most up-to-date range on Monday as investors weighed the latest developments in the United States debt ceiling stalemate.

The largest digital currency by market cap was recently currently worth about $26,866, up 0.4%. Bitcoin has hovered betwixt $26,500 and $27,500 for almost two weeks, reports by CoinDesk data, amid macroeconomic uncertainties, including concerns that United States President Joe Biden and House leadership would be unable to reach an agreement about raising the country’s debt limit.

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“ Cryptocurrency traders are not sure how Bitcoin (BTC) will behave throughout the following plenty of days of debt ceiling negotiations,” Edward Moya, senior market analyst for foreign exchange market maker Oanda, wrote in a note.

Moya went on to say: The danger of default is quite small but if it were to happen, that could feel like an uppercut to danger appetite, which would send cryptocurrencies sharply lower. Bitcoin (BTC) appears content to trade near the lower boundaries of its recent trading range betwixt $26,500 and $30,000.”

Since 1960, the Government has increased the debt limit 78 times, but the present, charged political environment has raised anxiety about the willingness of lawmakers to work together.

In a letter to Speaker of the House Kevin McCarthy (R-Calif.), United States Treasury Secretary Janet Yellen reiterated a May 15 warning that without an agreement, “the Treasury Department would be unable to satisfy all the government’s obligations by early June, and potentially as early as June 1.”

“We have learned from past debt limit impasses that waiting until the last minute to suspend or increase the debt limit can cause serious harm to business and consumer confidence, raise short-term borrowing costs for taxpayers, and negatively impact the credit rating of the United States,” Yellen added. “We have already seen Treasury’s borrowing boats increase substantially for securities maturing in June.”

Ether was recently changing hands at about $1,820, up 0.8%. The Second largest cryptocurrency in market  price has been similarly range-bound betwixt $1,750 and $1,850 in the previous two weeks. Other major cryptocurrencies were largely in the green, albeit paler shades, with TRX and Avalanche (AVAX), the crypto tokens of smart contracts platform Tron and Avalanche (AVAX), recently up 3.8 percent and 2.3%, respectively. The CoinDesk Market Index, a measure of cryptocurrency markets performance, recently rose 0.4%

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Between major equity indexes, the tech-focused Nasdaq Composite climbed 0.5 percent to hit a 2023 high, while the S&P 500, which has a critical technology component, and Dow Jones Industrial Average (DJIA) ticked up 0.2 percent and 0.4%, respectively. Yields on Treasurys rose, and the price of gold sank slightly to $1,990, well below its near-record high early these 30 days when investors were turning more to safe-haven assets.

In the meantime, in an interview with CoinDesk TV’s “ 1st Mover” program Monday, Ahmed Ismail, CEO of quant-based liquidity aggregator Fluid, stated that the retreat of market makers Jane Street and Jump Trading from cryptocurrency trading in the United States had spooked investors, decreasing an already dwindling supply of market liquidity.

“ 1 of the very big complications that cryptocurrency suffers with is liquidity being massively fragmented, and events such as this only exacerbate the problem,” Ismail stated. “So what we’re seeing at this time is there is not much activity because liquidity is even more fragmented, and markets are very inefficient. In doing so, you will  see I think we are seeing certain narratives coming back.

Ismail noted an boost in call options on cryptocurrency exchange Bybit, a signal of unrest about the debt ceiling and other macroeconomic uncertainties. “The narrative of people taking liquidity out because they’re afraid of what’s going to happen and the uncertainty around the debt ceiling, that’s certainly a huge challenge in keeping (the) cryptocurrency crisis so narrow now.”

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Largest Gainers

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Returns
DACS Sector
Shiba Inu (SHIB) SHIB
+3.4 percent Currency
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Polygon
MATIC
+1.9 percent Smart Contract Platform

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−0.5 percent Smart Contract Platform
Terra (LUNA) −0.5 percent Smart Contract Platform
Solana (SOL) Solana (SOL) −0.3 percent Smart Contract Platform

Insights

Cryptocurrency as Hedge

With the United States mired in political stasis while other regions build cryptocurrency frameworks, it’s worth looking at the evolution of, and outlook for, on-the-ground demand for cryptocurrency assets. This is getting increasingly relevant as numerous large countries struggle with skyrocketing inflation, shaky currencies and autocratic control over financial access, and as populations become increasingly crypto-aware and a lack of trust in centralized institutions grows.

Past week, the Government of Pakistan (the fifth largest country in the world in terms of population, with over 239 Million inhabitants) was informed to have stated that digital currencies “will never be legalized” in Pakistan, to be able to avoid FATF penalties.

Noelle Acheson is the previous head of research at CoinDesk and Genesis Trading. This post is excerpted from her Cryptocurrency Is Macro Now newsletter, which concentrates on the overlap betwixt the shifting cryptocurrency and macro landscapes. These opinions are hers, and nothing she writes should be taken as financing advice.

This may sound on the surface like an overreaction to FATF’s cryptocurrency stance – last Thursday, the organization’s president was released a letter titled “An end to the lawless cryptocurrency space” which urges cryptocurrency regulation rather than a total ban.

Then once more, Pakistan has a somewhat tense relationship with the FATF, and just last October was taken off its “grey list” (which labels certain countries as having “deficiencies” in their AML controls, which as a result can lead to limited participation in worldwide finance).

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It’s likewise not hard to see the hand of the International Monetary Fund. Pakistan is as of now in talks with the organization regarding a bailout package, although negotiations seem stalled and concern about the country’s political and economic issues is starting to affect neighboring countries. The IMF has not been shy about its unease with cryptocurrency markets, and several  months ago, reports surfaced that it had applied crypto-suppression conditions to negotiations with Argentina.

Read the full story here:

Important events.

4:00 p.m. HKT/SGT(8:00 UTC) Hamburg Commercial Bank Composite PMI (May)

4:30 p.m. HKT/SGT(8:30 UTC) United Kingdom S&P Global/CIPS Services PMIU (May)

6:45 p.m. HKT/SGT(22:45 UTC) New Zealand Retail Sales (QoQ/Q1)

CoinDesk TV

In case you missed it, here is the most up-to-date episode of ” 1st Mover” on CoinDesk TV:

Bitcoin (BTC) Sees Tightest Price Range in Months; Polygon Co- Founder on Web 3.0 Outlook

Glassnode data revealed that Bitcoin (BTC) (BTC) is settling into the tightest price range it has seen in months, regardless of looming concerns about the stability of United States regional banks and the country’s debt ceiling. FLUID CEO Ahmed Ismail shared his cryptocurrency markets analysis. Plus, Polygon co- founder Sandeep Nailwal discussed launching a Web 3.0 fellowship program. And, Litecoin Foundation managing director Alan Austin weighed in on the past few surge in Litecoin activity amid the frenzy surrounding Ordinals.

Headlines

Tether (USDT) Trading Volume Falls to Multi-Year Bottom Line, Market Capitalization Boost Is ‘Questionable,’ Kaiko: Trading with Tether’s (USDT) USDT crypto stablecoin has  dropped to its weakest point in four years, while its market cap nears an record-breaking peak of $83 billion.

Seeking Grants Deal with Osmosis, Privacy Blockchain Tech Namada Proposes Airdrop: Ahead of its mainnet launch Namada’s builders are attempting to ink an array of tech and crypto token partnerships.

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United States Debt Deal Could Weigh On Bitcoin (BTC) Price, Several Say: The Treasury’s efforts to build back cash balances after resolution of the debt limit situation can potentially suck out dollar liquidity from system, pushing Bitcoin (BTC) lower.

DEX Mangrove Launches on Polygon Testnet, Intends to Go Live on Mainnet in June: Wintermute and Cumberland-backed Mangrove plans a mainnet launch of its programmable order book DEX in early June.

Gemini Reveals Genesis Parent DCG Missed $630 Million Payment: Gemini reveals it is working with Genesis, DCG, and creditors to provide forbearance to DCG to be able to avoid a default.

Sam Reynolds and James Rubin.

CoinDesk Market Index (CMI)

1,162

ey_Takeaways”>Key Takeaways => Main Points=”0-diff-returns-string” class=”diff-value”>+4.9 0.4 percent

Bitcoin (BTC) $26,866

ey_Takeaways”>Key Takeaways => Main Points=”1-diff-returns-string” class=”diff-value”>+108.3 0.4 percent

Ethereum (ETH) $1,819

ey_Takeaways”>Key Takeaways => Main Points=”2-diff-returns-string” class=”diff-value”>+13.9 0.8 percent

S&P 500

4,192.63

ey_Takeaways”>Key Takeaways => Main Points=”3-diff-returns-string” class=”diff-value”>+0.6 0.0 percent

Gold

$1,972

ey_Takeaways”>Key Takeaways => Main Points=”4-diff-returns-string” class=”diff-value”>−6.7 0.3 percent

Nikkei 225

31,086.82

ey_Takeaways”>Key Takeaways => Main Points=”5-diff-returns-string” class=”diff-value”>+278.5 0.9 percent

BTC/ Ethereum (ETH) prices per CoinDesk Indices, as of 7 a.m. ET (11 a.m. UTC)

Source

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