First Mover Americas: Bitcoin, Up 70% This Year, Rebounds Past $28K
Bitcoin showed signs of resilience Wednesday, shedding tremors from the U.S. Commodity Futures Commission's lawsuit against crypto exchange Binance to recover and go above $28,000. The world’s largest cryptocurrency by market cap was up 6% over the past 24 hours to around $28,400. It has added almost 72% this year, with its best quarterly gain in two years. Just three months ago, some experts were mulling the possibility of bitcoin falling to as low as $12,000 this quarter, after its valuation had declined by 76% since November 2021. The rebound has put bitcoin ahead of ether, the second-largest cryptocurrency by market value, which appears on track for a 50% quarterly gain. Gold has added over 7%, while Wall Street's tech-heavy Nasdaq Composite index has rallied 15%.
The Crypto Fear & Greed Index, a metric that aims to measure current sentiment in the market, dropped to 59 on Tuesday, sliding from a nearly 18-month high of 68 reached one week ago, according to data from alternative.me. Readings above 50 indicate market sentiment has moved into the "greed" stage, while those below 50 indicate "fear." The index hadn't been as high as 68 since November 2021 when bitcoin reached an all-time record of nearly $69,000. Although the gauge has declined since last week to 59, it remains in the "greed" zone, suggesting investor sentiment for now remains bullish. The rebound to "greed" in 2023 comes as crypto prices bounced despite a growing number of regulatory crackdowns and macroeconomic fears.
With the ink still drying on the Binance lawsuit, CFTC Chairman Rostin Behnam reiterated Tuesday at a congressional hearing he believes ether is a commodity – a potentially controversial assertion that differs from what his counterpart at the Securities and Exchange Commission has said. A lawmaker on the House Appropriations Committee asked Behnam during a budget hearing Tuesday whether he believes ether should be on that list. "I believe they are a commodity,” Behnam said. “And because they are listed on CFTC exchanges, we do have a regulatory relationship – obviously with the derivatives market and that product, but the underlying market as well.”
Chart of the Day
- The chart shows daily changes in the DeFi Dominance index, which measures the market cap of a basket of top decentralized-finance coins as a percentage of the total cryptocurrency market.
- The index slipped from 5% to 4% in March, as regulatory fears and banking sector turmoil saw investors park money into bitcoin, the leading cryptocurrency by market value.
- "DeFi dominance at key support (4%) with technicals indicating the sector is oversold," Lewis Harland, a portfolio manager at Decentral Park Capital, said.