Bitcoin Slips Toward $38K After Rally Fizzles

Russia’s suspension of gas supplies to Poland appeared to darken the largest cryptocurrency’s failed attempt to hold gains above $40K, market analysts say.Read MoreFeedzy

Bitcoin (BTC), after a price pop on Monday above the crucial psychological level of $40,000, is again flirting with a six-week low.

As of press time, the largest cryptocurrency by market capitalization was down 3.3% in the past 24 hours, trading at $38,210 – close to the lowest since mid-March. The bitcoin price climbed as high as $40,800 earlier Tuesday but dropped more than 5% in the past four hours.

“Bitcoin reversed earlier gains after Russia reportedly suspended gas supplies to Poland,” said Edward Moya, senior market analyst at the foreign-exchange brokerage Oanda. That’s “a sign that war in Ukraine could see further escalations.”

“Bitcoin had a good start following news that Fidelity was planning on offering bitcoin for people’s retirement money, but risk aversion returned as investors remain fixated over aggressive central bank tightening, a worsening Russia-Ukraine war, and a disappointing uptake of using bitcoin as legal tender in El Salvador.”

U.S.-based financial services firm Fidelity Investments will allow investors to put bitcoin (BTC) into their 401(k) retirement savings accounts later this year, the firm said on Tuesday. Employers could place a ceiling on the amount of savings earmarked for bitcoin, with the maximum cap expected to be no more than 20%, according to CoinDesk’s Shaurya Malwa.

“Fidelity is the first major retirement-plan provider to do this,” wrote Marcus Sotiriou, Analyst at the UK based digital asset broker GlobalBlock in a newsletter, “And I think it sends a significant message to pension providers. Nobody wants to be first, but nobody wants to be last.”

“Yesterday, the Bitcoin Mining Council released a report which highlighted mining efficiency rose by 63% YoY,” Sotiriou also wrote, “with sustainable energy usage at 58%, marking the fourth quarter in a row above 50%. Furthermore, the network used 25% less energy [year over year]. These improvements are appealing for institutions who see environmental impact as one of the biggest reasons not to invest in bitcoin.”

Crypto analysis firm IntoTheBlock wrote in a Telegram message that short-term bitcoin holders who tend to follow the price action continue to decrease their positions. The balance held by these traders is 1.49 million bitcoin as of Apr. 25, the lowest since Jan. 18.

Ether (ETH) was down 2.58% in the past 24 hours, trading at $2,856.

U.S. stocks were down today. The S&P 500 was down 1.8% and the Nasdaq was down 2.89%.

Fidelity CEO Abby Johnson is scheduled to speak at Consensus 2022 in June.


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