By Eliman Dambell
Bitcoin was back in the red on Wednesday, as U.S. Federal Reserve Chair Jerome Powell called for more regulation in decentralized finance (defi), citing “structural issues” as a key reason. The token fell below $19,000 on the comments, moving closer to a key support point as a result. Ethereum also slipped following yesterday’s rebound, with the price back below $1,300.
Bitcoin (BTC) was back in the red on Wednesday, as markets reacted to comments from U.S. Federal Reserve Chair Jerome Powell.
Speaking on Tuesday evening, Powell stated that more regulation is needed in the crypto market, with recent declines in price highlighting “structural issues.”
In his comments, Powell said of the current relationship between defi and traditional finance: “Ultimately that’s not a stable equilibrium and we need to be very careful about … how crypto activities are taken within the regulatory perimeter.”
Following the remarks, BTC/USD slipped to an intraday low of $18,553.30 earlier in the session, less than a day after hitting a peak of $20,338.46.
As a result of today’s sell-off, bitcoin moved closer to its key support point of $18,300. However, bulls have responded, pushing price away from this level.
Currently, BTC is trading at $18,976.35, as traders seem to have closed out earlier shorts, giving way to some bullish sentiment.
Bitcoin wasn’t the only token impacted by Powell’s comments, with ethereum (ETH) also trading lower in today’s session.
The world’s second largest cryptocurrency fell to an intraday low of $1,267.87 on Wednesday, hitting a one-week low in the process.
Following a string of bearish sessions over the past fortnight, ETH/USD has recently moved into consolidation territory.
As can be seen from the chart, this has been between a support point of $1,230 and a resistance level of $1,300.
It seems that this sideways action has helped to curb a high level of bearish momentum, with the 10-day (red) moving average appearing to have found a bottom.
Should this be the case, it is likely that we will see further consolidation in coming weeks, with the potential for a rally at some point in October.
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Source: Bitcoin News.