Surge In Bond Yields Knocked BTC Downward: What happened Next?
After the Federal Reserve Chairman Jerome Powell’s comment last Friday, the surge in bond yields knocked Bitcoin downwards. Investors induced to turn around towards the less risky assets.
According to CoinDesk’s daily chart report, on that day, BTC was down to 3% at $48,308. It is now about $7000 lower than its recent ATH $58,000 level that pushed the splendid event of bitcoin’s hitting the $1 Trillion market cap.
We have witnessed a 6-fold upraise of BTC in terms of last year because of fiscal and monetary stimulus injection in the U.S economy to revive it.
Moreover, the primary fuel BTC’s magnetic rise was the speculators betting on BTC’s aspect as the dominant digital currency. Besides, the term “digital gold” fascinated institutional investors, taking it as a hedge against risks such as potential inflation in the post-Covid economy.
Factor Working Behind the BTC Downfall
However, Powell’s acknowledgment of being concerned with the tightening financial conditions and this question-and-answer interview with the Wall Street Journal had a great impact on the price rush towards the $48000 level last week.
His comments resulted in a surge in bond yields and prompted a red sell-off show in high volatile assets like bitcoin.
Current Market Situation Of BTC
Last day (Sunday), Bitcoin was traded higher with a 4% gain at $50,500 after U.S. President Joe Biden’s speech on the historic $1.9 trillion fiscal stimulus plan to combat the pandemic-induced economic crisis.
While writing this article, this power coin is traded for $50,683, which is surely a positive sign.
The Covid pandemic had a cruel influence worldwide; there is no doubt. But as for the financial trading markets, it, fortunately, blew a positive vibe somehow. That’s also the truth.
The market is now going through huge difficulties, creating many opportunities for investors.
If we see early 2020, all crypto asset prices were half in value than the current value. That means most of the crypto currencies and tokens gained almost 2x rise. So, investors are now more optimistic about their predictions on Bitcoin in 2021.
Indeed, this vibe is attracting the crypto bees way more than before.
Companies like Tesla, Micro Strategy, Square Inc. Etc., are investing in BTC even though it may or may not cause them a downfall in their share value.