Bitcoin regains $26,000, but new problems keep arising

Digital assets have recovered after falling sharply at the start of the week as a result of poor investor sentiment and fears that a massive sell-off in FTX assets would put downward pressure on prices, especially those of altcoins. Today, on Wednesday, the Delaware Bankruptcy Court will approve or reject the plan of the bankrupt cryptocurrency exchange, which made a series of changes so that the Department of Justice's Trustee's Office would withdraw its objections. Thus, the company will previously inform the Justice of its intention to sell tokens, but not so to the market.

FTX is not the only cryptocurrency exchange to grab industry headlines. Binance.US, the US subsidiary of the world's largest exchange, has also been in the news in recent hours due to the resignation of its CEO, Brian Shroder, and the dismissal of a hundred workers, about a third of its staff.

The company accused the Securities and Exchange Commission (SEC) of "aggressive attempts to cripple our industry", whose "resulting impacts on our business have real world consequences for American jobs and innovation, and this is an unfortunate example of that." It should be recalled that the regulator sued Binance on the understanding that the platform violated U.S. securities laws.

On the other hand, Matteo Greco, research analyst at Fineqia, stated that the last few hours saw "notable moves" by asset managers in transferring the equivalent of several million dollars worth of BTC and ETH on crypto exchanges. "While huge transfers to cryptocurrency exchanges are usually translated as a negative sign, since these transfers are due to the intention to sell or swap cryptocurrencies. However, when these transfers come from asset managers and trading companies, they may be for the purpose of managing and providing liquidity and nothing more, according to CoinDesk," he explained.

"These huge transfers come as part of another series of transfers, in addition to those towards digital wallets, which we witnessed last August and which enhanced the state of anticipation and caution among participants as these transfers may reflect the expectations and caution of major investors," he added.

Meanwhile, James Harte, market analyst at TickMill Group, noted that the optimism for spot BTC ETFs seems to have completely dissipated and that investors are now closely watching what the Federal Reserve (Fed) decides next week. In this regard, CME's FedWatch tool gives a more than 90% probability that the central bank will not move interest rates at the September meeting.

"Looking ahead, the bigger driver for BTC medium-term looks likely to continue to be the Fed and USD flows. If USD weakens through year end of diminished Fed tightening expectations and a growing focus on 2024 Fed easing, BTC is likely to recover higher with any FTX-related drop likely to provide better levels for longer-term buyers," he explained.

On the techinal side, the expert believes Bitcoin's sell-off from yearly highs "has seen the market breaking down below the rising trend line and below the 27415 level." "Price is now sitting on support at the 24930 level and, with momentum studies bearish, risks are pointed towards a break lower. If we do fall below current support, 21390 is the longer-run downside target," Harte added.

In other market news, there have been moderate gains for the main altcoins. Binance coin (BNB) rises 0.8%, while Ripple (XRP) and Cardano (ADA) rebound 0.4% and 0.1%. Solana (SOL) and Dogecoin (DOGE) fall moderately. Tron (TRX) rises the most, more than 2%.