Bitcoin in Stasis as BOE, ECB Follow Fed's Lead

The latest moves in crypto markets, in context

Edited by Omkar Godbole

December 16, 2021

Sponsored by

Bitcoin (BTC)

See the latest price here

Ether (ETH)

See the latest price here

If you were forwarded this newsletter and would like to receive it, sign up here.

Good morning, and welcome to First Mover. Here's what's happening this morning:

Market Moves: Bitcoin in Stasis as BOE, ECB Follow Fed's Lead

Technician's Take: Bitcoin's MACD Histogram Hints at Bull Revival

And check out the CoinDesk TV show "First Mover," hosted by Christine Lee, Emily Parker and Lawrence Lewitinn at 9:00 a.m. U.S. Eastern time. Today's show will feature guests:

– Omkar

Market Moves

by Omkar Godbole

Coins associated with smart contract platforms Solana and Avalanche and privacy-focused horizon token led gains among larger tokens early Thursday.

Bitcoin and ether struggled to gather upside traction even as traditional markets signaled continued risk recovery in the wake of the Federal Reserve's decision to signal three rate hikes in 2022 and terminate the asset purchase program in March.

AUD/JPY, the currency market risk barometer, extended Wednesday's 1% gain and the futures tied to the S&P 500 rose 0.6%.

However, animal spirits may not return to financial markets at least in the short term, thanks to the Bank of England (BOE) and European Central Bank (ECB) following the Fed's lead. The BOE delivered a surprise rate hike of 15 basis points early Thursday, challenging the narrative that central banks prefer to raise borrowing costs only after winding down the asset purchase program.

While the European Central Bank (ECB) kept key policy tools unchanged, it announced an end of net asset buying under the Pandemic Emergency Purchase Programme (PEPP) in March 2022. The ECB, however, did a balancing act by committing to boost an older asset-purchase program to €40 billion ($45 billion) in the second quarter of 2022 from €30 billion ($34 billion) in the first quarter.

The broader outlook remains constructive, with the real or inflation-adjusted interest rates likely to stay negative for a prolonged period and large traders buying the dip.

Purpose Bitcoin ETF Holdings (Source: Glassnode)

“Despite bitcoin’s recent 39% correction, the number of addresses with a non-zero balance continues to break all-time highs,” said Marcus Sotiriou, an analyst at the U.K. based digital asset broker GlobalBlock. “Also, since the $69,000 all-time-high, the Canadian Bitcoin Purpose ETF has added 6,341 BTC in assets under management, representing a 26.2% increase in coin holdings.”

“This suggests institutional interest is prevalent at these prices and that whales are buying up Bitcoin supply during this correction,” Sotiriou added.

Also read:

Solana Leads Gains as Cryptos Recover on Fed Decision

A Message from Bybit

In case you missed it, Bybit is giving away up to $3,000 in bonuses to each new Bybit user! All you have to do is join the community and make a first ever deposit. The more you deposit, the higher your rewards.
Plus, stand a chance to win 0.1 BTC or 1 ETH when you trade at least $100,000 in Spot and Derivatives combined. T&Cs apply.
Event ends Jan. 3, 2022, 10AM UTC.
*Terms and conditions apply.

Biggest Movers

These are the biggest movers in the CoinDesk 20 over the past 24 hours:

Top Gainers:

Polygon (MATIC): +11.7%, Sector: Smart Contract Platform

Top Losers:

There are no losers in CoinDesk 20 today.

Sector classifications are provided via the Digital Asset Classification Standard (DACS), developed by CoinDesk Indices to provide a reliable, comprehensive, and standardized classification system for digital assets. The CoinDesk 20 is a ranking of the largest digital assets by volume on trusted exchanges.

Technician's Take

by Omkar Godbole

Bitcoin's Bullish Inside Day

Bitcoin's daily chart with MACD histogram (Source: TradingView)

Bitcoin's daily chart MACD histogram, an indicator used to gauge trend strength and trend changes, is teasing a bullish reversal.

The 200-day moving average line is the level to defend for the bulls.

A Message from Amber

Everyone wants to build wealth with simplicity and security. But how?

WhaleFin is a digital investing experience offering easy portfolio management tools, attractive investment yields, and access to the emerging digital lifestyle. With over $1T in volume traded, WhaleFin offers personalized, compliant, and secure service across dozens of digital assets in 150+ countries. And every investment on WhaleFin helps protect aquatic habitats and reduce atmospheric carbon by supporting WDC and Moss Earth.

Find out more

ICYMI

In case you missed it, here are the most recent episodes of "First Mover" on CoinDesk TV:

Sen. Warren: Stablecoins Pose Risks to Consumers and Our Economy, Decential Co-founder Matt Leising on DAO’s Evolution and What Mainstream Media Gets Wrong About Crypto

"First Mover" hosts speak to CoinDesk Global Policy & Regulation Managing Editor Nikhilesh De for the key takeaways from the Senate Banking Committee hearing on stablecoins yesterday. Matt Leising, co-founder of DeCential and author of "Out Of The Ether," shares his views on DAO's evolution and outlook and what the mainstream media gets wrong about crypto. Plus, crypto markets insights and updates on the state of crypto in El Salvador from Sovryn Founder Edan Yago.

Latest Headlines

Crypto adoption is booming in semi-urban and rural areas of India despite lingering regulatory deadlock.

CoinDesk’s first ever year-end survey of crypto miners reveals a competitive but mature business with potential for merger activity to accelerate.

ISDA is aiming to characterize the different features of crypto assets and their relevance to contractual standards.

Visa, Mastercard and PayPal are expanding their crypto capabilities and continuing to invest across the fledgling industry.

S. Korean Lambda265 Nabs $60M Series B at $300M Valuation

The Dunamu company offers BaaS to corporations.

Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments.

First Mover

A newsletter from CoinDesk

Were you forwarded this newsletter? Sign up here.

Copyright © 2021 CoinDesk, All rights reserved.

250 Park Avenue South New York, NY 10003, USA

Manage your newsletter subscriptions | Unsubscribe from all CoinDesk email