Despite regulatory pressure and worsening macroeconomic conditions, Bitcoin (BTC) demonstrated bullishness holding near $28,000 for the past week. Furthermore, professional traders have maintained leveraged long positions on margin and in futures markets, indicating strength.
On the regulatory front, on April 4, the Texas Senate Committee on Business and Commerce agreed to move forward and remove incentives for miners operating within the state’s regulatory environment. If passed, Senate Bill 1751 would set a cap on compensation for load reductions on Texas’ power grid during emergencies.
Risk of recession grows against rate hikes
The risk of a recession grew after applications for U.S. unemployment benefits for the week ending March 25 were revised to 246,000, up 48,000 from the initial report.
Furthermore, Kristalina Georgieva, Managing Director of the International Monetary Fund (IMF), stated on April 6 that economies in the U.S. and Europe should continue to struggle as higher interest rates weigh on demand.
Regarding the banking crisis, Georgieva advised central banks to keep raising interest rates, adding, “concerns remain about vulnerabilities that may be hidden, not just at banks but also non-banks — now is not the time for complacency.”
On the other hand, on April 6, St. Louis Federal Reserve President James Bullard downplayed concerns about the impact of financial stress on the economy. Bullard stated that the Fed’s reaction to the banking sector’s weakness was “swift and appropriate,” and that “monetary policy can continue to put downward pressure on inflation.”
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Author: Marcel Pechman
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