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Bitcoin (BTC-USD) sank to below $27K in Monday late afternoon trading amid speculation that JPMorgan’s (JPM) takeover of First Republic Bank (FRC) could help contain the regional banking crisis.
The largest cryptocurrency by market cap retreated 5% to $27.97K as of shortly before 6:00 p.m. ET. Equities, by comparison, rolled over modestly as investors braced for the Federal Reserve’s interest-rate decision on Wednesday, in which the Federal Open Market Committee is expected to lift the benchmark rate by another 25 basis points, bring the target range to 5.0%-5.25%.
The tumult in the traditional banking sector that emerged in March served as a major boon for bitcoin (BTC-USD), surging over 31% since the failure of Silicon Valley Bank, and other major digital tokens. YTD, bitcoin is still up 68.2%. Earlier on Monday, the Federal Deposit Insurance Corporation seized First Republic (FRC) and later sold most of its assets and deposits to JPMorgan (JPM), in what marked the second biggest bank failure in U.S. history.
Increased regulatory uncertainty and a tough macroeconomic backdrop have also weighed on bitcoin’s (BTC-USD) price in recent weeks, as it attempted to break out of the $30K key technical level numerous times but failed each time.
