Bitcoin back above $28,000 as First Republic reignites banking fears
Quick Take
- Bitcoin was trading around $28,400, up about 3.7% in 24 hours by the early hours of Wednesday morning.
- Ether gained 2.2% in the same period, JPMorgan analysts continue to see sell-side pressure following Shapella.
- Traders going short were liquidated as the market ticked higher. About $77 million in shorts were wiped out.
Crypto prices rose overnight and into the early hours of Wednesday morning. The bump in price coincided with issues at another U.S. bank, this time First Republic.
Bitcoin was trading at $28,330 by 3:30 a.m. EDT, up 3.7% over the past day, according to Binance data via TradingView. The price of bitcoin climbed back above $28,000 after slipping below this level over the weekend. Ether gained 2.2% in the same period.
The bump in crypto prices yesterday coincided with yet more U.S. banking strife. First Republic saw $102 billion in deposit outflows during the first quarter of the year, $72 billion more than expected. The lender's woes have revived broader banking worries, according to Swissquote.
Banking issues in the U.S. kickstarted bitcoin's most recent rally to above $30,000 and were the catalyst for a return to the cryptocurrency's core use case, Standard Chartered said this week. The bank declare that the "crypto winter is over" — and it isn't alone in its prediction. Matrixport's Markus Thielen said the price of bitcoin may reach $45,000 by year-end.
BTCUSD chart from TradingView
Following its latest upgrade, JPMorgan analysts said that ether could face further selling pressure.
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"Binance initiated Ethereum withdrawals this week where participants can redeem for ETH with their BETH holdings at a 1:1 ratio," the bank wrote. Despite Binance withdrawals taking up to 15 days to be fulfilled, they could "put further pressure on ETH over the coming weeks." Liquid staking protocol Lido Finance plans to enable ether withdrawals at some point in May, JPMorgan analysts noted.
Binance announced its own liquid staking token on Monday, which will go live Thursday.
Shorts wiped out in the latest market move
Futures traders going long suffered upward of $700 million in liquidations during the crypto market's recent dip, the recent bump resulted in shorts suffering a similar fate.
About $77 million in short positions across derivatives exchanges were liquidated in the past 24 hours, according to data via Coinglass. Most of the shorts happened across Binance, OKX, and Bybit — $21 million, $14.9 million, and $12 million, respectively.
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