Key ideas:
- It was a mixed session on Thursday for the top ten crypto, with ETH bucking a downtrend.
- US economic indicators provided late support but failed to distract investors from rising regulatory risk.
- The crypto market capitalization fell $5.67 billion, ending the day at $1.049 billion.
It was a mixed session for the crypto top ten on Thursday. ETH challenged a downtrend, while MATIC led the way down. The mixed session is gone BTC under $24,000 for the first time in seven sessions.
US economic indicators and the NASDAQ Composite Index provided support in the afternoon. In the fourth quarter, the US economy expanded 2.7%, down from a preliminary 3.2%. Economists forecast growth of 2.9%. However, labor market conditions continued to tighten, with initial jobless claims falling from 195k to 192k. Economists forecast a rise to 200k.
The NASDAQ Composite Index rose 0.72% in response to the figures and corporate earnings.
However, the NASDAQ failed to deliver a bullish crypto session, with increasing regulatory scrutiny weighing on investor appetite.
Crypto Scrutiny Tests Buyer Sentiment
On Thursday, the US Federal Reserve released a statement detailing the risks of trading cryptocurrencies and cryptocurrency-related assets. Highlighting liquidity risks related to sources of funding for cryptocurrency-related entities, the Fed said,
"Certain sources of funding from crypto-related entities may pose increased liquidity risks for banking organizations due to the unpredictability of the scale and timing of deposit inflows and outflows."
The Fed joined the SEC in its focus on stablecoins, stating,
โThe stability of such deposits (stablecoin-related reserves) may be linked to the demand for stablecoins, the confidence of stablecoin holders in the stablecoin agreement, and the reserve management practices of the stablecoin issuer. Such deposits may be susceptible to large and rapid outflows stemming from, for example, unforeseen redemptions or dislocations of stablecoins in crypto asset markets."
With the US Department of Justice, SEC and CFTC increasing their supervisory activities on cryptocurrencies, the IMF also shared its view on the digital asset space. On Thursday, the IMF released a document titled Elements of Effective Policies for Crypto Assets.
According to the document, the IMF aims to "address questions from Fund members about how to respond to the rise in crypto assets and the associated risks."
With the crypto market facing increased scrutiny, news from the SEC and the New York Department of Financial Services (NYDFS) object toward BinanceThe US acquisition of Voyager was also bearish. Binance.US's plans to acquire Voyager helped ease the risk of contagion in late 2022.
the day ahead
In the afternoon session, US economic indicators and the NASDAQ index will likely provide guidance. The basic PCE price index, personal income and expenses will earn interest. An unexpected rise in the core PCE price index would add to the Fed's fears heading into the weekend.
Investors should also keep track of the FOMC members' conversations. Loretta Mester, a member of the FOMC, will speak today.
While statistics and the NASDAQ Composite Index will provide direction for the afternoon, regulatory activity and chatter from lawmakers will remain the focal points. An increase in regulatory activity would test buyers' appetites amid growing regulatory uncertainty.
The NASDAQ mini is down 32.75 points this morning.
Crypto Market extends losing streak to three sessions
It was a mixed session on Thursday. A bullish start to the day saw the crypto market cap rally to an early morning high of $1.075 billion before pulling back. The reversal caused the crypto market capitalization to slide to a midday low of $1.036 billion.
However, finding support in the afternoon, the crypto market capitalization ended the day at $1.049 billion, marking a loss of $5.67 billion on Thursday.
The top ten crypto market movers and shakers and beyond
It is a mixed session for the top ten crypto.
ETH resisted the downtrend, rising 0.47%.
However, MATIC led the way down, falling 2.84%.
ADA (-1.54%), bnb (-1.31%), BTC (-1.00%), DOGE (-1.29%), and XRP (-1.71%) also joined the broader crypto market in the red.
From the CoinMarketCap top 100, it was a mixed session.
coin engine (ENJ) and stacks (STX) led the way, increasing by 12.04% and 10.81%, respectively, with conflux (CFX) ending the day up 7.36%.
However, tezos (XTZ) fell 6.21%, with NEO (neo) and monero (XMR) with losses of 5.55 % and 3.77 %, respectively.
24-hour sell-offs ease into bearish crypto-session
For 24 hours, cryptocurrency selloffs returned to below normal levels on Friday. Long positions had a higher proportion of liquidations, accounting for 60.41% of total cryptocurrency liquidations. This morning, 24-hour liquidations stood at $96.91 million, down from $125.29 million on Thursday morning (UTC).
Traders liquidated in the last 24 hours were also lower. This morning, traders settled stood at 29,024 compared to 49,712 on Thursday morning. Crypto liquidations were lowest for 12 and four hours and over one hour.
According purse, 12-hour sales stood at $46.66 million, down from $63.13 million on Thursday morning, and four-hour sales fell from $8.76 million to $3.50 million. One-hour settlements decreased from $5.31 million to $0.365 million.
The following chart shows the market conditions throughout the session.
