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On Thursday, Bitcoin (BTC) remained relatively stable, hovering just below the $29,000 mark, which has been its position for the majority of the past 10 days. This price level was observed as investors evaluated the potential impact of interest rate hikes by central banks in the United States and Europe, as well as the latest developments in a growing bank crisis.
According to data from CoinDesk, the most valuable cryptocurrency in terms of market capitalization was trading at approximately $28,800 recently, representing a decline of 0.3% in the last 24 hours. On Thursday morning, as the U.S. stock markets opened, BTC dropped below the $29,000 threshold and continued to fluctuate within the range of $28,700 to $29,000.
Ether (ETH), the second-largest cryptocurrency in terms of market capitalization, exhibited a comparable trend, with prices hovering around $1,877, representing a 0.6% decrease from the previous day at the same time. The prices of other prominent cryptocurrencies demonstrated minimal movement throughout the day. Litecoin's LTC token remained relatively stable, trading at approximately $87.8, while Solana's SOL token experienced a slight decline of approximately 0.8%, reaching a trading price of $21.70.
The CoinDesk Market Index (CMI), which gauges the collective performance of the cryptocurrency market, experienced a 0.3% increase throughout the day.
Equity markets encountered challenges on Thursday, with the S&P 500, a prominent benchmark equity index in Wall Street, concluding the day with a 0.7% decrease. The Dow Jones Industrial Average (DJIA) and the technology-focused Nasdaq Composite exhibited declines of 0.8% and 0.4%, respectively.
The stocks of various regional banks experienced significant declines on Thursday, with PacWest Bancorp (PACW) based in Los Angeles plummeting by 50% during the afternoon and Western Alliance Bancorporation (WAL) based in Phoenix experiencing a decline of 38%. Investors expressed concerns about the potential spread of problems throughout the banking sector, which initially surfaced in mid-March following the failures of three banks, including Silicon Valley (SVB) and Signature.
PacWest is currently considering various alternatives, which may involve a potential sale of the company. On the other hand, Western Alliance has dismissed rumors of being on the market for sale.
Within the bond markets, the two-year Treasury yield, which serves as an indicator of short-term interest rate projections, dropped by 15 basis points to 3.78%, nearing its lowest point this year. Moreover, the 10-year Treasury yield decreased by approximately 2 basis points, reaching a value of approximately 3.37%.
“The financial crisis that we seem to be sleepwalking into will almost certainly become real,” Anthony Georgiades, co-founder of decentralized layer 1 blockchain Pastel Network, wrote in an email to CoinDesk.
“Banks will struggle even more now given that the yield curves are so incredibly inverted," he said. "And, ultimately, this will likely force the [U.S. Federal Reserve] into urgent rate cuts and a return to something akin to quantitative easing – or else the economy and the banking itself will be in deep, deep trouble." He added that the latter scenario could buoy BTC.
Edward Moya, senior market analyst for foreign exchange Oanda, wrote in a Thursday note that BTC “isn’t seeing the same amount of flows as it did early during all the banking drama with SVB.”
“It is getting very ugly for financials and that should spell trouble for the broader economy,” Moya wrote. “Bitcoin appears anchored until it gets regulatory clarity.”
Source Coindesk
