Home News Bitcoin Hits $23.9K as Amazon Enters Web3 in Asia

James Carter

30 Jan 2023

Bitcoin Hits $23.9K as Amazon Enters Web3 in Asia

Before the U.S. central bank announced its latest decision on interest rates, crypto investors were in a good mood on the weekend.

They sent bitcoin that was the closest it had been to $24,000 since mid-August. At one point on Sunday, the largest cryptocurrency by market capitalization was worth more than $23,900. It then went down to about $23,760, which is a nearly 3% gain in the last 24 hours. In spite of sometimes contradictory economic data and worrying fourth-quarter earnings reports from some of the world’s biggest brands, the markets have been primarily optimistic over the past week.

On Friday, the U.S. Commerce Department reported that the annual rate of increase in personal consumption expenditures (PCE), excluding food and energy, in December was the lowest it had been since October 2021. The PCE is a crucial measure of inflation that the Federal Reserve looks at closely when making decisions about money. It showed that the economy is cooling, but services inflation is still holding firm.

“The drop in goods inflation is good news because it brings inflation closer to the Fed’s goal of 2%,” First Republic Bank wrote in a weekly note to investors. “However, service inflation is still high, which shows that the Fed has more work to do,” the bank added.

Still, Joe DiPasquale, CEO of fund manager BitBull Capital, told CoinDesk in a text message that the Federal Open Market Committee (FOMC) was likely to raise rates by twenty-five basis points at its two-day meeting, which starts on Tuesday. After eight months of more aggressive rate hikes, investors’ hopes for this more dovish shift in monetary policy have driven a lot of the rise in crypto prices and other risk assets in January.

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DiPasquale wrote that the “more modest increase” is one reason why the prices of many cryptocurrencies have gone up. “It’s seen as a good sign for the economy and is now factored into the price of bitcoin. In recent years, it has been linked to the stock market in a good way, and the lower rate is a good sign for the stock market.

Ether, the second most valuable cryptocurrency on the market, did even better than BTC on Sunday. At one point, it traded for over $1,650, up nearly 5%. In the last nine days, ETH has gone over this level twice. Most of the other significant cryptocurrencies by market cap spent most of Sunday in the green, with MANA, the token of the 3D virtual reality platform Decentraland, and SAND, the native currency of the metaverse game Sandbox, recently jumping more than 15% and 7%, respectively, and SOL, the token of the Solana blockchain, up 8.2%.

Friday was another good day for stock markets. The tech-heavy Nasdaq and the S&P 500, which also has a lot of tech stocks, both closed up more than a percentage point. The S&P has reached its highest end in almost two months. This is a significant change from its dull 2022. Even though Amazon, Salesforce, and Microsoft have all announced job cuts in anticipation of a slowing economy, investors are cautiously optimistic about inflation and other big-picture economic issues.

In crypto news, the sad story of Sam Bankman-Fried continued on Friday when federal prosecutors asked U.S. District Court Judge Lewis Kaplan to stop the former CEO of FTX from talking privately with current and former employees of the troubled exchange and its investment arm, Alameda Research. Prosecutors said that Bankman-Fried had reached out to a former FTX employee in a “thinly veiled” attempt to “sway possible testimony.”

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BitBull’s DiPasquale said that the market is still set up for a drop after the recent rise, which was caused by a short squeeze and investor optimism and lasted for weeks. “Investors might want to cash out now because there’s a chance bitcoin could go back down after a few weeks of gains, and it could reach $20,000 again soon,” DiPasquale wrote.