Bitcoin is beginning to falter along with equities, and we will likely see lower prices into the weekend. We expect this negative momentum to continue since BTC has historically performed poorly over the weekends. Our next support target for Bitcoin is $21,000. We could see that new price become the bottom of a new trading range, or we will continue downwards into the Spring.
One of the headlines attributed to this recent decline in Bitcoin is what is happening with Binance and BUSD. In the weeks following the SEC asking Paxos to stop issuing Binance’s Stablecoin, we have continued to see large bank runs on Binance. According to a report from Blockworks, the total BUSD circulating supply has decreased by 26%.
Bitcoin is dragging down Hedera along with the altcoin market. HBAR could potentially form a lower low depending on how intense Bitcoin declines over the next few months.
COIN is trading erratically and the price chart itself highlights the confusion investors are feeling. When there is a general sense of confusion, you can be sure that you are in a trading range.
As we continue to see the United States and China rattle their sabers, we expect Binance to become a larger target for U.S. regulators. As tensions increase between the two superpowers, the United States will likely use its influence to stifle one of China’s largest web 3.0 businesses. While we have championed stablecoins like USDC in the past, the collapse of FTX shows that nothing is certain in crypto. There is no better alternative to having cash instead of stablecoins.