Bitcoin hits 17-month high as Powell strikes less hawkish tone
Bitcoin prices rose on Thursday after the Federal Reserve struck a less hawkish tone than markets expected, with broader cryptocurrencies also advancing as the dollar weakened and traders bet on no more rate hikes.
The world’s largest cryptocurrency by market capitalization rose nearly 4 percent to $35,808, its highest level since May 2022. Ethereum, the world’s second-largest cryptocurrency, rose 3 percent to $1,866.19, a near three-month high.
The crypto market was largely boosted by a weaker dollar and falling yields after the Federal Reserve held interest rates steady on Wednesday, as widely expected. The Dollar Index fell more than 0.5% in Asian trading on Thursday.
Fed Chairman Jerome Powell appeared to strike a less hawkish tone on future rate hikes. While he still left the door open for one more rate hike this year, Powell also acknowledged that monetary conditions have tightened significantly in recent months. Markets took this as a signal that the Fed may not raise rates any further and could potentially begin cutting rates by mid-2024.
This notion caused traders to move out of the dollar and into riskier assets, which benefited cryptocurrencies.
Bitcoin topped $35,000 for the first time since May 2022. A series of high-profile bankruptcies in the crypto market – including Terra, Three Arrows Capital, and most notably FTX – had triggered deep declines in crypto prices last year. The world’s largest crypto token had fallen to as low as $15,000 by the end of 2022.
The token has been on a tear in recent weeks, benefiting greatly from speculation that an exchange-traded fund that directly tracks the price of bitcoin will soon be approved in U.S. markets.
Applications from Grayscale, Ark Ventures and, most notably, the world’s No. 1 asset manager BlackRock Inc (NYSE:BLK) are under review by the Securities and Exchange Commission.
However, much of these gains also appeared to be driven by a drastic drop in liquidity as broader retail interest in the crypto space continued to decline. Bitcoin’s trading volume had fallen sharply from the lifetime highs seen in 2021.
On the technical front, bitcoin also appeared to be on the verge of retracing much of last year’s bear market decline.
“Just a few hundred dollars higher at $36k is the 38.2% fibo retracement of the entire bear market decline from $69k to $15.5k,” said Tony Sycamore, market analyst at IG, in a tweet.
Crypto markets were also awaiting quarterly results from major exchange Coinbase Global Inc (NASDAQ:COIN), which are due later on Thursday.Blockchain sleuth PeckShield has published an X post, sharing that it has spotted another chunk of cryptocurrency stolen from the beleaguered just recently.
This time, the FTX hacker made a transaction that involved approximately 288.8 bitcoin, worth nearly $10 million.
Here’s how much crypto was stolen from FTX in total
The FTX crypto trading giant collapsed in the early days of November almost a year ago, and then the mysterious hacker took advantage of it, stealing around $500 million in cryptocurrency. He then converted almost all of the stolen crypto into ETH, receiving 180,000 Ethereum. These ETH coins were then withdrawn to 12 different addresses. At that moment, this amount of ETH was valued at nearly $200,000,000 in fiat.
Immediately after that, the hacker became the largest holder of the second most popular cryptocurrency. Later in November, the exploiter moved 50,000 ETH to another wallet and then converted it to Ren Bitcoin (RenBTC), an Ethereum-based version of bitcoin.
Attempts to exchange stolen ETH this year
As reported by U.Today, in early October, the FTX exploiter attempted to exchange it for tBTC via the ThorSwap DeFi platform. When this attempt was discovered, the platform opted to suspend operations and go into maintenance mode rather than allow the hacker to exchange the stolen funds.
The cybercriminal then turned to another chain – Threshold Network – and cross-chained ETH into the Bitcoin network. At this point, the hacker still had approximately 110,000 ETH, which at the time was worth $180,000,000.
After ThorSwap was suspended, Bitcoin maximalist Max Keiser took the opportunity to bash DeFi as “heavily centralized” in contrast to BTC.
171,800 ETH sent to major US exchanges
In another turn of events, crypto tracker Whale Alert published data showing that crypto traders have been actively selling large amounts of Ethereum. Earlier today, four more or less consecutive transactions involving 21,852 ETH and three transfers of 50,000 ETH each were made to such leading U.S.-based crypto exchanges as Coinbase (NASDAQ:COIN) (one) and Kraken (the three chunks of 50,000 each).
After a remarkable growth of 18.14% within a week (between October 20 and October 26), Ethereum reached a local high of $1,848 (following the flagship crypto bitcoin, which surpassed the $34,000 level). Ethereum’s surge was followed by a meager 2.84% decline last week.
Nevertheless, the second largest cryptocurrency continues to hold the $1,800 level at the time of writing.
