Bitcoin rose after Biden's executive order on crypto, then fell. Here's how investors should react
The price of bitcoin quickly rose above — and then fell below -. 40,000 after President Joe Biden signed a sweeping executive order on the cryptocurrency this week.
The price of bitcoin jumped 10% to above 4 42,000 after news of the executive order, which calls on government agencies to develop a plan to regulate cryptocurrency, and consider a central bank-issued digital currency. But the increase was short — lived, with bitcoin later dropping below.40,000-where it was before the executive order was announced.
Biden's order is the first concrete move by the White House to regulate cryptocurrency, which has emerged as a key element of the war in Ukraine that continues to drive additional volatility in the cryptocurrency and equity markets.
Earlier this month, bitcoin briefly topped 4 45,000 on March 2 for the first time since February. 10. After an initial drop of less than 335,000 in February. 24 after the invasion of Ukraine, bitcoin again got above 4 40,000 in February. 28 and stayed above that all week until late last week. Experts told Next Advisor that the adoption of the most widespread crypto, the crypto market increasingly tracking the stock market, and the low prices to start the year all contribute to the volatility with the crypto prices we are seeing now. Ethereum follows a similar pattern.
Bitcoin has been running above 4 440,000 for most of February, after a slow start to the year. Its drop below يناير 34,000 in January was the lowest price for bitcoin since July 2021.
Before the war in Ukraine led to new volatility, bitcoin has already been lagging in recent months amid continuing high inflation, the worst month for the stock market since March 2020, and persistent signals that the Federal Reserve will start raising interest rates at its next meeting in March in an effort to counter inflation. Meanwhile, government officials have continued to show interest in stronger regulation and participation in cryptocurrencies — including the possibility of creating a government-issued digital currency. Ethereum's price has followed a similar pattern to bitcoin in recent months.