Bitcoin returned to the red on Wednesday as US Federal Reserve Chairman Jerome Powell called for more regulation of decentralized finance (defi), citing “structural issues” as a key factor. The token fell below $19,000 on the comments, thus approaching a key support point. Ethereum slipped following yesterday’s rebound, with the price returning below $1,300.
Bitcoin
Bitcoin (BTC) returned to the red on Wednesday as markets responded to comments from US Federal Reserve Chairman Jerome Powell.
Speaking on Tuesday night, Powell expressed the need for more regulation in the crypto market, highlighting the “structural issues” that the recent decline in prices has caused.
In his comments, Powell said of the current relationship between DeFi and traditional finance: “Ultimately that’s not a stable equilibrium and we have to be very careful about how… crypto activities are handled around regulation.”
Following the comments, BTC/USD fell to a low of $18,553.30 earlier in the session, less than a day after reaching a high of $20,338.46.
Due to today’s selling price, Bitcoin is close to the key support point of $18,300. However, the bulls responded, pushing the price from this level.
Currently, BTC is trading at $18,976.35, as traders seem to have closed shorts earlier, giving way to some bullish sentiment.
Ethereum
Bitcoin wasn’t the only token affected 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 series of bearish sessions over the past two weeks, ETH/USD has recently moved into consolidation territory.
As can be seen from the chart, this is between the $1,230 support point and the $1,300 resistance level.
As the 10-day (red) moving average appears to have bottomed out, this sideways action appears to have helped stem the bearish momentum.
If this is the case, we may see further consolidation in the coming weeks, with a possible rally sometime in October.
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