The cryptocurrency market is experiencing unprecedented shifts, with Bitcoin’s trading volume dropping below the $5 billion mark. As of Sunday, Bitcoin stands at $25,878, with a minor dip of less than 0.10%. Several contributing factors are in play, including the power crisis in Texas, which is negatively impacting miner reserves and hindering BTC price recovery.
At the same time, a Federal Reserve official has indicated that a concrete decision regarding digital currency is still on the horizon. In contrast, banking giant JPMorgan has made significant strides in the sector by launching a blockchain-based token designed to expedite payments. This dynamic landscape demonstrates the ever-evolving nature of the cryptocurrency realm.
The energy shortage in Texas is having a detrimental effect on Bitcoin mining, resulting in a slowdown of BTC price recovery. Miners in the state, which is a major hub for Bitcoin mining due to low energy costs and loose regulations, are shutting down operations due to worsening power issues caused by extreme weather. This crisis is threatening the network’s hash rate, especially considering AntPool, a key contributor responsible for about 22.27% of Hash Power, is affected. Miner sell-offs to cover expenses during this crisis could lead to bearish pressure on BTC prices.
The Federal Reserve’s Vice Chair for Supervision, Michael Barr, has stated that the decision to issue a central bank digital currency (CBDC) in the United States is still far from being made. Speaking at the Seventh Annual Fintech Conference hosted by the Federal Reserve Bank of Philadelphia, Barr expressed concerns about stablecoins denominated in USD, highlighting potential risks to financial stability, monetary policy, and the U.S. payments system. Barr emphasized that while the Federal Reserve is researching developments in programmable payments platforms, blockchain technology, and digital assets like cryptocurrencies and stablecoins, this is distinct from making a decision on the next steps in payments system development.
JPMorgan Chase & Co. is making major advancements in blockchain technology by unveiling blockchain-based digital deposit tokens designed to enhance cross-border payments and settlements. These tokens represent customer deposits in commercial banks and aim to expedite transactions while reducing costs using blockchain’s efficiency. However, regulatory approval is a crucial factor for their adoption. The tokens are distinct from JPM Coin, which facilitates internal fund transfers among corporate clients.
The news from today may not have an immediate effect on BTC/USD, but it highlights the caution US officials are taking with digital currencies. JPMorgan’s CEO Jamie Dimon is skeptical about cryptocurrencies, yet the bank continues to embrace blockchain technology. These blockchain advancements could influence market sentiment and discussions surrounding the role of cryptocurrencies in traditional finance.
Bitcoin is showing a measured ascent, currently positioned just above the $26,000 mark. While the trajectory suggests potential revitalization, there is resistance at $26,500. In recent sessions, BTC has overcome a pronounced bearish trajectory, now contending with key resistance zones. If BTC can surpass the $26,500 threshold, a significant upward shift is possible, targeting elevations nearing $28,000. However, if it struggles to do so, a downward adjustment is plausible, with primary support levels anchored at $26,100 and $26,000.
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