Bitcoin, Ethereum, Dogecoin Subdued Ahead Of Fed Meet: Crypto Layoffs Abound As Bear Market Bites

Zinger Key Points
  • Bitcoin, Ethereum, Dogecoin remain under pressure ahead of Wednesday's Fed meet
  • Massive layoffs at cryptocurrency firms signal preparations for crypto winter
  • Altcoins could see a bounce, according to crypto trader Michaël van de Poppe

Bitcoin, Ethereum and other major coins were trading lower on Tuesday evening as the global cryptocurrency market cap fell 0.6% to $986 billion at press time.

Price Performance Of Major Coins
Coin 24-hour 7-day Price
Bitcoin BTC/USD -2.6% -29.6% $22,013.60
Ethereum ETH/USD -0.6% -33.8% $1,205.07
Dogecoin DOGE/USD -1.7% -31.7% $0.055
Top 24-Hour Gainers (Data via CoinGecko)
Cryptocurrency 24-Hour % Change (+/-) Price
Helium (HNT) +17.2% $9.55
Bitcoin SV (BSV) +13.5% $53.01
Decentraland (MANA) +13% ​​$6.67

See Also: Best Crypto Debit Cards

Why It Matters: Bitcoin and Ethereum settled around the $22,000 and $1,200 levels after plunging earlier this week as jittery investors sold off ahead of a key U.S. Federal Reserve meeting.

Bitcoin traded between $21,046.95 and $23,014.15 on an intraday basis, while Ethereum swung between $1,095.02 and $1,250.17 levels.

On Tuesday, stock markets also arrested their rapid slide but the rebound was limited. The S&P 500 ended the day 0.4% lower while the Nasdaq closed 0.2% higher. At press time, S&P 500 and Nasdaq futures were up 0.5% and 0.7%, respectively.

The market is expecting a steep rate hike on Wednesday. OANDA senior market analyst Edward Moya noted that wholesale prices are still climbing higher and are slightly off the record annual pace.

“Aggressive tightening over the next handful of policy meetings is the only course of action for the Fed.”

On Bitcoin, Moya said traders “better be buckled” as a hawkish decision could result in Treasury yields and the dollar surging and putting more pressure on the apex coin.

“If Bitcoin breaks below the $20,000 level, support might not emerge until the $17,000 level. Another crypto plunge might not see major support until the 2019 summer high around the $14,000 level,” wrote Moya, in a note seen by Benzinga.

The U.S. dollar index, a measure of the greenback’s strength against six other currencies, rose as high as 105.46 on Tuesday, a level not seen since December 2002, reported Reuters.

Fears surrounding the viability of major industry players, especially in decentralized finance, are also exacerbating the side after cryptocurrency lender Celsius (CEL) halted withdrawals on Sunday.

GlobalBlock analyst Marcus Sotiriou made note of the layoffs at the cryptocurrency trading platform BlockFi along with a string of redundancies at firms like Crypto.com.

“​​We are still in the early phase of crypto, where many DeFi products are being tested and selectivity will result in many failing along the way,’ said Sotiriou.

On Tuesday, Coinbase Global Inc COIN, the second-largest cryptocurrency exchange by spot volume, announced layoffs citing dour market conditions. It is cutting 18% of its workforce to “stay healthy during this economic downturn,” according to CEO Brian Armstrong.

“A recession could lead to another crypto winter, and could last for an extended period,” said Armstrong in a blog post. 

“In past crypto winters, trading revenue (our largest revenue source) has declined significantly. While it’s hard to predict the economy or the markets, we always plan for the worst so we can operate the business through any environment."

Despite the downturn, MicroStrategy Corporation MSTR remains a hodler, according to CEO Michael Saylor. The company faces a margin call on a loan if Bitcoin falls below the $21,000 level.

Saylor tweeted Tuesday that MicroStrategy “anticipated volatility and structured its balance sheet so it could continue to [Hodl] through adversity.”

Bitcoin whales showed interest in the apex coin around the $22,000 level, as 12,969 whale transactions, valued above $100,000, were noted over a 12-hour period by Santiment, a market intelligence platform.

Whale interest in Bitcoin aside, it could be so-called altcoins that register significant spikes over the coming days. Cryptocurrency trader Michaël van de Poppe tweeted altcoins are showing more strength than Bitcoin and could see an upside of 20-40% in the next few days.

Read Next: Not Bitcoin Or Gold: 'Rich Dad Poor Dad' Author Says This Is The Best Investment To Beat Inflation Right Now

Posted In: BitcoindogecoinEthereumCryptocurrencyNewsTop StoriesMarketsMoversTrading Ideas

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