As expected, the price of BTC surged at a very fast pace today, hitting $28,000 on different cryptocurrency exchanges. This happened after it showed earlier progress by hitting $27,500 24 hours ago. This position was said to have triggered mass profit-taking activities among cryptocurrency investors, especially BTC holders. But as of the time of writing this, the price of BTC stands at $28,080. This is an increase of approximately 8% from 24 hours ago.
The Ether was the next to be affected by the price surge, with a 5% increase in price while trading at $1,813 as of the time of this report. Analytically speaking, Bitcoin is said to have experienced up to 60% from the Q4 of 2022 to date. Ether, however, was reported to have a 45% increase during the same period. Most recent analysis also has it that other cryptocurrencies gained during this period.
These cryptocurrencies include Binance Coins (BNB), Ripple (XRP), and Cardano, all adding more than 5% or more. This huge upturn was said to be responsible for the massive triggering liquidation of more than $164 million in the last 24 hours. According to some data made available by Coinglass, it was revealed that in the previous 24 hours, 45,000 different short trades were affected during this event.
Circumstances That Led to Price Fluctuation
Analysts believe that this price movement is coming at a time when the microeconomic indicators have a direct effect on the cryptocurrency sector. These analysts also believe that events like the collapse of some major United States-based cryptocurrencies banks like the Signature Bank and other popular ones, the Silicon Valley Bank played a major catalyst in the price movement.
Also, the call by some government bodies to prevent the cryptocurrency from getting banked spiked panic amongst Bitcoin and other cryptocurrency holders. The development has propelled most of them to sell their assets at minimal profit. This situation, which caused panic sales among traders, resulting in a drastic price decline. On the other hand, the speedy intervention of the Federal Deposit Insurance Corporation (FDIC) and the United States Treasury was said to have saved the deposits in those affected banks.
This didn’t just save the day but also prevented the prices of these coins from plummeting further. Analysts also believe such interventions were the reason behind the speedy recovery of those other coins that lost their value during the mass profit-taking activities.
Comments and Contributions From The Federal Reserve
As a desperate effort to manage the current crisis in the United States banking system, the United States Federal Reserve has been reported to have initiated its balance sheet. Investigations show that this is the first time since introducing the balance sheet since the authorities started increasing the interest rates. It was gathered that on the 15th of March, the Federal Reserve had provided $297 billion on an emergency funding basis.
It has been revealed that this fund had played a major role in preventing further decline in these banks, which have also recorded some losses in customer deposits. This development has also degenerated into a significant shift, not only to the prices of these cryptocurrencies but their entire existence.
In this scenario, some of the mainstream investors have suggested that one of the best protective measures to preventing a reoccurrence of the global financial meltdown of 2008. A tweet by Andreas Muller: a popular Market Analyst, reminded the public about what triggered the global meltdown in 2008 while acknowledging the efforts of relevant government authorities in managing the situation.
Andreas Muller, in the tweet, said that many investors are now looking for a safer haven for their digital assets. This also explains why there has been a huge movement of investors from the United States into the Swiss banks, the majority of whom are previous customers of those collapsed banks.
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