Traders removed about $3 billion worth of Bitcoins off controlled exchanges as the first cryptocurrency’s price soared to $39,000 after the Federal Reserve kept the country’s key rate steady.
However, while some traders and investors were relieved to see Bitcoin approaching $40,000, the presence of extra financial dangers on the market.
Also, as Jerome Powell’s statements regarding inflation and monetary policy, pulled Bitcoin down below $36,000.
According to Powell, rising inflation in the United States could aggravate the market in the coming months, which is why the regulator would intervene in the first half of the year. The 16th Chair of the Federal Reserve announced that the first rate hike is expected in March.
The conference was viewed as a risk-off for the market in general, and as a result, it had a negative impact on Bitcoin, which is viewed as a risk asset.
Traders are withdrawing their currencies for a variety of reasons.
While massive outflows from exchanges are characteristic of a bear market. Also, large investors and institutions may be able to use exchanges to acquire additional cryptocurrencies while trading at a discount.
During the market’s recent slump, an unnamed whale purchased nearly 500 BTC. The same whale also had about 125,000 BTC in his wallet. Large sums of money are frequently kept in a cold wallet for extra security.
However, despite the fact that about $3 billion worth of cryptocurrencies were removed from exchanges. So, there is still a lot of selling pressure on the market, pushing Bitcoin lower.
Bitcoin is currently selling at $36,268 and has lost 1.5 percent of its value since the beginning of the year. Since the local high, the cryptocurrency has lost around 7% of its value.
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