Bitcoin BTC price breaks its losing streak in Tuesday night’s rally

Good morning. Here is what happens:

Prices: A late push took bitcoin back to its previous level above $28,000. Ether also rallied.

Knowledge: Is crypto on the mend? What will happen from a regulatory point of view? CoinDesk’s annual Consensus Conference features crypto industry leaders and will cover key topics over three days.

Bitcoin Surge, but will the rally continue?

After five days below $28,000, bitcoin surged surprisingly and took much of the rest of the market with it.

The largest cryptocurrency by market capitalization was recently trading above $28,300, up around 3.7% in the past 24 hours. The origins of the outbreak were difficult to pinpoint. BTC began rising less than 24 hours after struggling First Republic Bank noted it had lost $100 billion in deposits during its first-quarter earnings report on Monday, reigniting concerns over the stability of the banking sector. Last month, cryptos rose amid a wave of U.S. regional banking implosions as investors sought refuge in assets that hold their value.

“With First Republic Bank looking set to fail, I suspect the market is pricing in even more liquidity injections to support what certainly appears to be a still-crisis-ridden US banking sector,” Jake Boyle said. , director. of Caleb & Brown, a retail crypto brokerage firm, wrote in an email to CoinDesk. “Bitcoin, therefore, tops those expectations. Cracks in the financial system are growing, albeit relatively subtle at the moment, and it will be incredibly difficult for the Fed to adhere to its tightening regime in the future. ‘coming.”

Boyle added: “Bitcoin’s rally of late has more to do with liquidity injections and rising expectations that Fed tightening will likely have to end soon enough or even greater turmoil in the banking sector could occur. ensue.”

Data from analytics firm Coinglass also showed that some $11.3 million in BTC short positions had been liquidated since 4 p.m. Short cuts have historically tended to accelerate price increases.

Ether recently changed hands at around $1,870, up 1.8% from the same time on Monday. Other major cryptos were largely in the green with SOL, the native token of the Solana blockchain, and ADA, the native crypto of smart contract platform Cardano, both recently up more than 3%. The CoinDesk Market Index, a measure of overall crypto market performance, rose 2.6%.

At the start of trading in Asia, the Nikkei and Hang Seng indices were down slightly. US stocks closed with the tech-heavy Nasdaq Composite down nearly 2%.

In his weekday column, CoinDesk analyst Glenn Williams pointed out that at least two technical indicators point to a rebound in bitcoin. Williams noted that “BTC’s recent decline has been accompanied by an expected decline in momentum, but it has also occurred in conjunction with movement towards the lower end of the Bollinger Band. Bollinger Bands plot an asset’s 20-day moving average and calculate two standard deviations above and An asset’s price is expected to stay within two standard deviations of the mean 98% of the time, therefore a breach above or below is conspicuous.

Williams wrote that “bitcoin approaching the lower range of its Bollinger Bands raises questions about its near-term trajectory, but he added that “given recent history, technical analysts might expect BTC prices are moving, albeit methodically, towards their 20-day average. .”

What to expect consensus

The crypto is down but not out. The industry that was battered last year is set to make its first major public exposure of 2023 at Consensus, CoinDesk’s annual conference. Many of the biggest names in crypto, government, Web3 and more will be in Austin, TX this week to discuss the current state of the industry, the devastating year it has just had and what the future may hold.

From that side, things are improving. If the first four months of the year are any indication of the direction the industry is heading, the rebuilding has begun.

Yet there is still much to build, policy, educate and, yes, invest. While recent markets have given cause for optimism, fraud and contagion have completely shattered consumer confidence in the industry. Regaining that trust will be difficult, but it’s an opportunity at the feet of today’s builders, regulators and policymakers – many of whom will share their insights at Consensus.

Here’s what to expect this week in Austin.

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Crypto exchange Coinbase has asked a federal court to force the SEC to respond to a petition it filed last year seeking formal regulation in the digital asset industry. This came as Republicans on the House Financial Services Committee take another twist on stablecoin legislation with a discussion draft revealed Monday afternoon. Rep. Patrick McHenry (RN.C.) joined “First Mover” to chat.

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