Cryptocurrency markets have taken a hit in Monday morning trading. Bitcoin fell from its resistance level of US$28,000 and several of the top 10 non-stablecoin cryptocurrencies traded below their prior levels. The dip mainly follows the news of U.S. regulators filing charges against Binance, the world’s largest crypto exchange.
The charges allege that Binance violated trading rules such as Anti-Money Laundering and Know Your Customer. As a result, the crypto markets have developed a sense of uncertainty and investors are retreating with caution.
However, the U.S. equities performed better on Friday. The Federal Reserve’s main inflation indicator reflected a slowdown in the economic growth of the country. This could potentially lead to the end of the Fed’s tightening cycle, meaning that it would not proceed with rate hikes in the near future. Overall, this was welcomed by investors and thus, the market reacted in a positive way.
It is worth noting that the cryptocurrency market is not completely detached from the traditional stock markets. The dip that Bitcoin and other non-stablecoin cryptocurrencies experienced on Monday can be attributed to the uncertainty arising from the U.S. law enforcement action and the recent surge of the US equities.
The rise of U.S. equities come as a result of the Federal Reserve’s preferred inflation gauge showing signs of slowing down. If the Fed decides to not proceed with the rate hikes, investors would likely be more willing to put their money in US equities due to the potential growth offered by such investments.
Ultimately, uncertainty always affects the market, no matter it is the traditional stock market or the cryptocurrency market. The Fed’s decisions usually play an important role in influencing the market regardless of which asset is being considered. This can be seen in the recent happenings of the two markets. While Bitcoin and other non-stablecoin cryptocurrencies experienced a dip due to the uncertainty of the Binance news, U.S. equities jumped as a result of the Federal Reserve’s promising news.
Jayden Bennet
- 2023-04-03
Uncertainty in Cryptocurrency Trading Led by Binance Charges
Cryptocurrency markets have taken a hit in Monday morning trading after U.S. regulators had filed charges against Binance, the world’s largest crypto exchange. Investing in cryptocurrencies is increasingly becoming uncertain; however, the US equities reacted positively to the news.
