Bitcoin and cryptocurrencies turn bearish, worried about the Fed and the SEC

After another rally that had investors hopeful, the reigning cryptocurrency is once again unable to consolidate at the $25,000 level. Analysts are leaning towards different reasons to explain this new setback, with the release of the Federal Reserve (Fed) minutes being one of the most recurrent and obvious reasons.

"We know that the Fed officials will sound concerned with the strong jobs market and will point at the resilience of the economy to continue hiking the rates," stated Ipek Ozkardeskaya, senior analyst at Swissquote Bank. As such, he explained, "the minutes will be hawkish, and could further weigh on sentiment. But there is always a chance that the market sees the glass half full than half empty."

In this regard, Ozkardeskaya believes that the negative correlation between stocks and bonds, after stocks rose and bonds fell may be coming to an end. "In the absence of recession talk, the Fed expectations will continue driving markets, and the increasingly hawkish Fed expectations are bad for both stock and bond valuations," he explained.

On the other hand, Laurent Kssis, cryptocurrency trading advisor at CEC Capital, believes a breakout above $25,000 hinges on the performance of technology companies. "Tech firms performed horrendously last year, and it's all down to how well they recover in the first quarter. That's why BTC is not pushing further," he pointed out in statements to 'CoinDesk'.

Furthermore, Kssis stressed that we will see a Bitcoin rally again when the capital accumulation in Tether (USDT), the largest 'stablecoin' in the market, ends. "When BTC is rallying, USDT dominance tends to thin out," he noted. According to TradingView data, USDT's share of total crypto market capitalization fell from nearly 9% to 6.5% in January with the rise of Bitcoin, but has held steady at that level since then.

At the same time, other experts point to the Securities and Exchange Commission's (SEC) regulatory advance as a factor that triggered market volatility. According to data provider Kaiko, increased regulatory risks dented market sentiment, and "volatility is unlikely to go away." Since their offensive on Kraken and Binance USD, they noted, long- and short-term buying and selling have fallen back to zero, which indicates a neutral sentiment in the options market.

Coinbase´s results are also noteworthy, as they have given the market a mixed result. Although the cryptocurrency exchange has beaten experts' forecasts for profit and revenue, the truth is that transaction revenues have fallen by 12% compared to the figures for the previous three months. In addition, the platform's CEO and co-founder, Brian Armstrong, has criticized regulators for their "disjointed approach" to regulating the crypto sphere.

In the rest of the market, there have been falls. Highlights include a 5% plunge in Cardano (ADA) and 9% fall in Solana (SOL) and Polygon (MATIC), whose creator company Polygon Labs announced a major round of layoffs.