Bitcoin held firm at $26.5K on Thursday, largely unaffected by the Securities and Exchange (SEC) lawsuits against exchange giants Binance and Coinbase. Investors are now looking ahead to the Federal Reserve’s monetary policy decision next week, which Valkyrie Chief Investment Officer Steven McClurg believes will halt its hawkishness at its next FOMC meeting, but not after.
It’s hard to imagine a tougher regulatory situation facing the digital asset industry in the United States than what’s happening right now, said Andrew Lawrence, co-founder and CEO of onchain custody platform Censo. It can feel pretty bleak, and yet there’s been a tremendous resilience shown by Bitcoin and other key crypto assets.
The resilience of cryptocurrencies is attributed to the growing embrace of digital assets outside the U.S., such as the growing trade volumes in Asia and new more crypto-friendly regulatory frameworks in the European Union and Dubai.
Digital assets are truly global, Lawrence noted.
The second largest crypto in market value, Ether, held tight in uptrend territory of the CoinDesk Indices Ether Trend Indicator (ETI), a bullish sign even as bitcoin has languished in a downtrend position. Tokens mentioned in the separate lawsuits rebounded slightly, and major stock indexes closed on the upside.
The probability that interest rates will remain at the current target rate of 5%-5.25% is 72.5%, according to the CME Fedwatch tool. Steven McClurg believes the Federal Reserve will suspend its nearly year-long diet of rate hikes, given what he sees as an ongoing banking crisis.
It’s very prudent that the Fed has decided to stop raising rates at the moment, primarily because we do have a banking crisis on our hands right now, and we also have a dollar competence crisis, McClurg said.
McClurg added that he would be closely watching oil prices, which have retreated over the past year from near record highs. I believe oil will probably double in price this year, which will drive the rest of inflation, McClurg said.