Bitcoin dips below $45,000 and points to further declines amid Fed minutes and global uncertainty

Blame it on the Fed. The cryptocurrency market is trying to stabilize on Friday after extending its recent declines in the wake of the US Federal Reserve minutes. Bitcoin gave up an important support level on Wednesday and closed Thursday below $43,000, which portends more pressure for the queen of digital assets. As for the 'altcoins', they turned green on Friday and most tokens cut earlier losses, especially Dogecoin, which is up 2.5%. Ethereum, meanwhile, rebounds to $3,300.

Total capitalization holds above $2 trillion, but experts predict more pressure for Satoshi Nakamoto's coin and the other crypto currencies because of falling risk appetite fueled by the certainty of a rapid normalization of monetary policy from the world's largest central bank. According to Fed minutes, the agency plans to reduce the central bank's balance sheet by $95 billion per month.

Reaction in the markets was mixed, as much of the content of the minutes had already been telegraphed by Lael Brainard the day before, but the world's most traded cryptocurrency has succumbed to the pressure and has fallen back below $45,500. Experts indicate that Bitcoin (BTC) could see further near-term pain and rush towards the support zone between $40,000 and $42,000. On the intraday charts, Bitcoin broke below the one-month uptrend line. That means short-term sellers are in control.

"The long term remains favorable and there is clearly a lot of support for the cryptocurrency, but the environment is not helping," commented Craig Erlam, an analyst at Oanda, trying to send a signal of relief to the markets. Another reassuring fact is that the broad-based recovery from the January lows is still intact, analysts pointed out.

LUNA CONTINUES TO BUY BITCOINS

In other news, Luna Foundation Guard's (LFG) Bitcoin purchases stand out, to the point where it has a larger pantry of BTC than Tesla right now. The latest deal by the nonprofit tasked with building reserves that support Terra's blockchain smart contract - whose token is UST - is for $230 million, which has increased its exposure in the cryptocurrency to $1.6 billion at the current market price of $45,100, the foundation's confirmed Bitcoin address shows.

This is the first significant purchase since March 30th. The foundation purchased about $125 million in Bitcoins each day from March 22nd through March 25th and allocated $160 million on March 26th. LFG announced in February that it had raised $1 billion through an over-the-counter sale to create a reserve of Bitcoins as an additional layer of security for UST.

The size of the reserve was increased to $3 billion last month, and Terraform Labs founder and CEO Do Kwon tweeted that he planned to build a reserve of 10 billion Bitcoins.

The foundation's buying spree has put it ahead of U.S. electric car maker Tesla, which has $1.26 billion in BTC on its balance sheet.

The latest purchase comes at a time when Bitcoin is hit by macroeconomic jitters, offering the foundation the opportunity to buy at low prices.