Bitcoin Faces Headwinds as ETF Optimism Stalls; DOGE, SOL Give Back Gains

Ether (ETH) lost 0.5%, while dogecoin (DOGE) and solana (SOL) slumped as much as 5% as traders likely took profits.

AccessTimeIconNov 21, 2023 at 10:11 a.m. UTC
Updated Mar 8, 2024 at 5:25 p.m. UTC

Bitcoin (BTC) prices were little changed in the past 24 hours while major tokens gave back gains from their early November rallies.

BTC traded just over $37,500 in European morning hours Tuesday, adding 0.6%. Ether (ETH) lost 0.5%, while dogecoin (DOGE) and solana (SOL) slumped as much as 5% as traders likely took profits.

BNB Chain’s (BNB) tokens were up as much as 8% amid reports that crypto exchange Binance, which initially issued the tokens, could soon be paying $4 billion to settle multiple U.S. criminal charges.

Some traders expect bitcoin to trade sideways in the coming weeks as its recent rally is running into headwinds caused by uncertainty about the Federal Reserve’s next steps and due to delays in a key regulatory decision about ETFs.

“The upside has been suppressed at the $38,000 psychological level,” analysts at the Japanese exchange bitbank led by Yukari Kusu shared in a Tuesday note. “One of the reasons why bitcoin failed to breach that level is the SEC’s decision to postpone its decision to approve or disapprove Hasdex’s bitcoin ETF on Thursday.”

Meanwhile, analysts at crypto exchange Bitfinex said in a Tuesday note that they expected the Fed to hold rates steady in the December meeting.

“Headline inflation has declined remarkably from 6.4 percent at the beginning of the year. This should give the Fed enough room to hold rates steady in its December meeting, in line with current expectations in the Fed Futures market,” the analysts shared. “This would also align with its goal of sustaining economic expansion.”

“However, this pause in rate hikes doesn't signal a change in the Fed's broader tightening policy. The central bank remains cautious and ready to adjust rates if inflation persists or unexpectedly increases,” they added.

Interest rate decisions have the tendency to move markets. Higher rates usually mean risk assetss such as stocks and cryptocurrencies take a hit as investors could take profits and invest in bonds.

Edited by Oliver Knight.


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Shaurya Malwa

Shaurya is the Deputy Managing Editor for the Data & Tokens team, focusing on decentralized finance, markets, on-chain data, and governance across all major and minor blockchains.

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