Fed rate hike does not prevent bitcoin from rising above $48,000

At the time of publication, bitcoin had rolled back to $47,350 at a market capitalization of $901 billion.

Bitcoin experienced a major sell-off earlier this year, and only during last week's price rally was BTC able to recoup its 2,022 losses.

According to Coinglass, more than $230 million worth of short positions were liquidated on March 28. This happened because bitcoin spot volumes exceeded BTC futures volumes when the price of the major cryptocurrency rose to $48,000. Accordingly, the bitcoin price recovery is largely driven by the spot market.

Despite bitcoin facing resistance at the 200-DMA level, many cryptocurrency market participants remain optimistic. Kyle Davis, co-founder and chairman of Singapore-based cryptocurrency hedge fund Three Arrows Capital, is confident in the strength of BTC:

• After several waves of bad news - the destruction of leverage, macroeconomic problems, the war in Ukraine - there were no sellers left. So it is only natural that bitcoin has become a strong bet.

In addition, earlier this month, the U.S. Federal Reserve announced its first rate hike of 200. This was the first time in four years. The U.S. central bank also said that the Fed is preparing for multiple rate hikes this year, making the market nervous and unstable.

However, Jeff Dorman, chief investment officer at cryptocurrency asset management firm Arca, said that historically risky assets tend to rise after rate hikes:

• The whole sell-off in risky assets was exaggerated and initially made no sense. Markets usually rise during a rate hike, and only at the end of a rate hike cycle do markets move in the other direction.

In addition, CoinShares data shows that institutional capital inflows into cryptocurrency funds totaled $193 million last week. Bitcoin accounted for about 50 percent of the total.

Analytics company Santiment analyzed cryptocurrency activity:

• Bitcoin sets were active today. 3,266 transactions over $100,000 between 2 p.m. and 6 p.m. GMT reached the highest 4-hour interval since March 1. Eight hours ago, market prices peaked just above $48,000, now down to $47,300.