Bitcoin (BTC) Hits $17K for the First Time in Two Weeks; Will the Market Bounce?

Lion silhouette in front of giant bitcoin coin
  • Bitcoin reached its highest trading level since November 15th, surpassing $17,000 before reversing course.
  • After FTX failed this month, investor trust in cryptocurrencies plummeted.
  • Powell’s speech at the Brookings Institution on Wednesday will also be keenly followed by traders.

Bitcoin (BTC) hit a two-week high on Wednesday as investors continued to think about the effects of the collapse of the cryptocurrency exchange FTX. 

Bitcoin’s price jumped above $17,000, a level not seen in the past two weeks, as investors anticipated a speech by the chairman of the U.S. Federal Reserve that may signal a less aggressive monetary policy.

The world’s largest cryptocurrency by market capitalization briefly dipped below $15,000 a few days ago but has since recovered the $17,000 mark.

After Sam Bankman-Fried’s FTX cryptocurrency exchange crumbled and declared bankruptcy earlier this month, investor confidence in the industry took a major hit.

Given that the crypto market is currently dealing with FTX’s fall, the central bank’s monetary policy, and China’s ongoing problems caused by its tight COVID controls, the crypto asset’s rise is impressive.

Bitcoin’s price rose by as much as 3.78%, reaching $17,021.67, its highest price in two weeks. As of writing, CoinMarketCap shows that Bitcoin has moved below the $17,000 level and is trading up 2.30% at $16,890.27 with a 24-hour volume of $25,116,087,381.

 Bitcoin Traders Anxiously Await Fed Chair’s Speech

The increase occurred before Federal Reserve Chair Jerome Powell’s anticipated speech, which many assume will confirm earlier predictions of lesser interest rate increases in the United States.

On Wednesday, Powell is scheduled to appear at a gathering organized by the Brooking Institution. Powell could bring up what Fed officials have indicated about the country’s slower-than-expected implementation of interest rates. If accurate, it would be a welcome change from the Federal Reserve’s typically aggressive monetary policy, which is thought to be a major factor in the recent decline in Bitcoin prices. 

The Federal Reserve released the minutes from its most recent meeting last week, which sent the prices of many crypto assets through the roof. The minutes highlighted that smaller increases would enable authorities to evaluate the effects of the increment.

On the Flipside

The implosion of the hedge fund Three Arrows Capital in January and the collapse of the algorithmic stablecoin terraUSD (UST) in May have contributed to the loss of more than $1.3 trillion in the value of cryptocurrencies this year. The situation has become much direr since the FTX crash.

Why You Should Care

The Fed Chair will speak on Wednesday, and the substance of his address will be eagerly followed by traders for hints about the Fed’s intentions for interest rates. There might be a positive impact on risky assets like stocks and cryptocurrencies if the market anticipates a slower pace of rate hikes.

 

Related market reads:

Crypto Founders Included in Forbes 30 Under 30 Despite Market Downturn

Tether Supply Drops $2B While USD Coin Rises

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed as financial, legal, or tax advice. Trading forex, cryptocurrencies, and CFDs pose a considerable risk of loss.

Author
Arnold Kirimi

Arnold is a crypto enthusiast who learned about Bitcoin in 2017. He is fascinated by the technology behind it and the potential it has to revolutionize the world economy. He is a prolific writer and enjoys sharing his knowledge with others. He is also a tech enthusiast and loves tinkering with gadgets and software.