First Mover Asia: Crypto Prices Finish Largely in the Red

Good morning. Here’s what’s happening:

Market moves: Bitcoin drops, while Bitfinex’s LEO pumps on the latest development of the 2016 hack.

Technician's take: Overbought signals on intraday charts preceded the current BTC pullback. Lower support nearby into the Asia trading day.

Catch the latest episodes of CoinDesk TV for insightful interviews with crypto industry leaders and analysis.

Bitcoin (BTC): $44,187 +.06%

Ether (ETH): $3,134 -0.3%

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S&P 500: 4,251 +0.8%

DJIA: 35,462 +1%

Nasdaq: 14,194 +1.2%

Gold: $1,826 +1.0%

Bitcoin (BTC) retreated to near $41,000 on Tuesday before recovering in the afternoon, while LEO, the token of crypto exchange Bitfinex, surged. U.S. officials announced they had seized roughly $3.6 billion worth of bitcoin tied to the exchange’s 2016 hack.

At the time of publication, the oldest cryptocurrency was trading at $44,187, roughly where it was 24 hours ago, according to CoinDesk data.

Bitcoin fell on Wednesday after it went as high as $45,519.24 during Asia trading hours, based on data from TradingView and Coinbase. Ether, the second-largest cryptocurrency by market capitalization, was down slightly over the past 24 hours to just over $3,132, according to CoinDesk data.

Data compiled by CoinDesk shows that after a relatively quiet week, bitcoin’s trading volume across major exchanges has increased gradually this week.

The market chatter on Tuesday, however, centered on the potential impact of the latest development around Bitfinex’s hack in 2016. As CoinDesk reported, the U.S. Department of Justice announced on Tuesday that it had seized some $3.6 billion worth of bitcoin tied to the breach. The number marks the largest financial seizure in history by U.S. law enforcement, according to the release.

UNUS SED LEO token (LEO), the utility token intended to be used on Bitfinex and other trading platforms managed by its parent company iFinex, rose 40% in just 20 minutes after the news broke.

Bitfinex said it would buy back and burn any outstanding LEO if it recovers the stolen bitcoin within 18 months of the day of receiving this bitcoin.

Bitcoin Stalls Near Resistance; Lower Support at $40K

Bitcoin (BTC) reached a high of $45,488 over the past 24 hours, near a key resistance zone that preceded the current pullback. The cryptocurrency could find lower support at $40,000 into the Asia trading day.

The relative strength index (RSI) on the four-hour chart is declining from overbought territory, similar to what occurred in late December amid a short-term downtrend. This time, however, bitcoin has broken above previous resistance levels, which means the current pullback could stabilize soon.

One concern is the low conviction among buyers, evidenced by low trading volume during the prior price rally. Low volume rallies typically result in pullbacks or range-bound trading before a more definitive price bottom is confirmed.

8:30 a.m. HKT/SGT (12:30 a.m. UTC): U.S. goods and services trade balance (Dec.)

8:30 a.m. HKT/SGT (12:30 a.m. UTC): U.S. goods trade balance (Dec.)

6:30 p.m. HKT/SGT (10:30 a.m. UTC): Australia Westpac Consumer Confidence (Feb.)

6:50 p.m. HKT/SGT (10:50 a.m. UTC): Japan money supply M2+CD (Jan./YoY)

9 p.m. HKT/SGT (1 p.m. UTC): Reserve Bank of New Zealand inflation expectations (Q4/QoQ)

In case you missed it, here is the most recent episode of "First Mover" on CoinDesk TV:

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US Officials Seize $3.6B in Bitcoin From 2016 Bitfinex Hack: Nearly 120,000 BTC was stolen in the hack.

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“After the execution of court-authorized search warrants of online accounts controlled by (Ilya "Dutch") Lichtenstein and (Heather) Morgan, special agents obtained access to files within an online account controlled by Lichtenstein. Those files contained the private keys required to access the digital wallet that directly received the funds stolen from Bitfinex, and allowed special agents to lawfully seize and recover more than 94,000 bitcoin that had been stolen from Bitfinex. The recovered bitcoin was valued at over $3.6 billion at the time of seizure." (Department of Justice press release) ... "If you are wondering what adoption looks like, more than 52 million Americans already own cryptocurrencies today. It’s estimated that over 27% of millennials own some form of crypto." (Chamber of Digital Commerce founder and CEO Perianne Boring) ... "2022 is starting to look like a defining year for the future of central bank digital currencies (CBDCs). Just a few weeks in and we’ve already seen countries take firm stances for and against the technology – or in the case of the U.S. Federal Reserve Board in its much-anticipated discussion paper released last week, calling for more research and collaboration with the other branches of government." (Stellar Development Foundation Chief Operating Officer Jason Chlipala) ...“This is a huge step back to normalcy for our kids." (New Jersey Gov. Phil Murphy on removing the school mask mandate in the state) ... “We are in a situation of extreme tension, a degree of incandescence that Europe has rarely known in the past decades." (French President Emmanuel Macron)