Market speculation about further interest-rate hikes by the U.S. Federal Reserve remains a headwind for Bitcoin, says Marcus Sotiriou of GlobalBlock
Bitcoin has held above $43,000 following its recent price advance. However, the cryptocurrency still appears hesitant to sustain a major breakout, according to analysts at GlobalBlock, a UK-based digital asset platform.
Sotiriou highlights market concerns over higher interest rates as a key factor that could be limiting Bitcoin’s upside potential.
In a note shared with CoinJournal, Marcus Sotiriou reviewed several recent Bitcoin-related developments and pointed to data showing a recent reversal led by gains in the futures market. He observed that the latest rally was driven by derivatives markets while spot markets were selling off.
The cumulative volume delta (CVD) for spot and futures markets shows that futures activity has increased notably in recent weeks while spot volumes have remained subdued.
“This suggests this rise has been driven more by speculation or hedging than by genuine demand,” he said.
With broader markets focused on the language in the Federal Open Market Committee’s minutes from the January 25–26 policy meeting, Sotiriou said the report could offer “insight” into the Fed’s thinking on interest rates.
He added that the market is unlikely to be “surprised” by the FOMC minutes, since investors have already priced in a March move. Nevertheless, uncertainty remains over how aggressively the Fed may act.
Despite these concerns, Sotiriou noted that growing institutional investment in the crypto sector is a positive sign for a potential recovery.
Examples include Singapore’s DBS, which planned to roll out crypto trading services for retail clients by the end of 2022, and Fidelity, which recently launched an exchange-traded product (ETP) in Europe.
At the time of writing, Bitcoin was trading around $43,630, down nearly 1% over the past 24 hours. The digital asset appears to be mirroring U.S. equities, with the S&P 500 and Nasdaq down 0.76% and 1.31% respectively.