Cryptocurrencies such as Bitcoin (BTC), Shiba Inu (SHIB), Dogecoin (DOGE) are starting a new week. As the importance of Bitcoin and altcoins’ relationship with traditional assets has emerged, the US Federal Reserve (FED) statements are in the focus of the people. In addition, geopolitical turmoil continues and there is a focus on developments in Europe. There is thought to be plenty of uncertainty in the air. So, will Bitcoin and altcoins benefit from this chaos? What will happen this week?
How are Bitcoin, SHIB, DOGE affected by geopolitical situations?
The Fed is the likely leader when it comes to crypto performance this week. On Wednesday, policymakers will decide whether to continue with the key rate hike expected since last year. With inflation soaring, the small rate hike is said to be only modest, but the consequences could still be significant for Bitcoin and altcoin users. BTC has shown a tight hold on US equities and any reaction from the Fed is thought to affect the market.
analytics firm Santiment, “This week is going to be big for crypto and equity investors as the Fed is expected to decide on a quarter-point rate hike this week. “Bitcoin and Ethereum are pegged at SP500 in 2022 and these decisions should greatly impact cryptocurrencies.” However, the Fed is not the only macro player that Bitcoiners should worry about. While Russia-Ukraine tensions continue, meanwhile in China, the coronavirus itself is on the radar again.
MiCA voting will take place in the EU
As we reported in the morning as Kriptokoin.com, lawmakers in Europe are trying to ban proof of work (PoW) protocols, citing environmental concerns. The unit is preparing to vote on the law.
Two years have passed since Bitcoin’s coronavirus panic “crash”
Popular Twitter account Crypto Tony said, “Compared to all the other macro drops we’ve seen, we haven’t seen the capitulation collapse yet.” Such a capitulation move has already been voiced as a sure possibility, and it would have been pretty brutal if it happened, almost exactly two years after BTC/USD dropped to $3,600 in the first round of coronavirus turmoil.
Analyzing near-term prospects, Plan C talked about the Confluence Floor model and concluded that a macro price bottom could happen next month. However, such a low could drop to $27,000 and briefly push Bitcoin below its 2021 opening price and out of the range it has consolidated since then. “I’m not convinced we went to $27,000, but if history repeats itself for the 4th time in a row, this could be the lowest of the accumulation phase,” Plan C said in the Twitter comments.
Are we in the accumulation phase in Bitcoin?
In terms of savings, everything seems to be not bad when it comes to demand for Bitcoin at current prices. While whales have been active in recent days, the proportion of total BTC supply controlled by smaller investors has reached a one-year high. The changes were noted on Monday by Philip Swift, creator of ten chain analytics resource LookIntoBitcoin.
Separate data from CryptoQuant confirms the trend and covers the 21 major BTC balances from the exchange are at their lowest combined level since the beginning of August 2018 – 2.32 million BTC. The latest Glassnode data shows that exchanges lost another $1.9 billion in BTC last week.
Bitcoin, SHIB, DOGE market sentiment impresses no one
Bitcoin, SHIB, DOGE and the broader crypto sentiment are definitely pointing downhill this week. After two months of fake outs, the bulls seem to be getting tired. Twitter analytics account On-Chain College summarizes, “Bitcoin sentiment is now worse than July 21st and price is now above $8,000 from July 21 low.” Cane Island Digital Research highlighted that volume is another revealing sign that momentum from Bitcoin is falling. Meanwhile, the Crypto Fear and Greed Index stays in the “extreme fear” zone near the 20/100 mark.
Expectation of Bitcoin bonds from El Salvador
In the eyes of the markets, there are also Bitcoin bonds announced by El Salvador in November. Although there was a lot of news on this issue over the weekend, there was no official statement. While the exact date of the issuance of the bonds, which are expected to attract $1 billion, is unknown, doubts are growing that it could arrive this week.
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