Decentral Block Post

Bitcoin (BTC) bulls laid most of their options at $24,500 and higher for the March 3 options expiry, and given the recent bullishness seen from BTC, who can blame them? On Feb. 21, Bitcoin price briefly traded above $25,200, reflecting an 18% gain in eight days. Unfortunately, regulatory pressure on the crypto sector increased and despite no effective measures being announced, investors are still wary and reactive to remarks from policymakers.

For instance, on Feb. 23, U.S. Securities and Exchange Commission Chair Gary Gensler claimed that "everything other than Bitcoin" falls under the agency's jurisdiction. Gensler noted that most crypto projects "are securities because there's a group in the middle and the public is anticipating profits based on that group."

March 1 comments from two U.S. Federal Reserve (FED) officials reiterated the necessity for even more aggressive interest rate increases to curb inflation. Minneapolis FED President Neel Kashkari's and Atlanta FED President Raphael Bostic's comments also decreased investors' expectations of a monetary policy reversion happening in 2023.

The stricter stance from the macroeconomic and crypto regulatory environment caused investors to rethink their exposure to cryptocurrencies. Nevertheless, Bitcoin's price decline practically extinguished bulls' expectation for a $24,500 or higher options expiry on March 3, so their bets are unlikely to pay off as the deadline approaches.

Bulls were "rug pulled" by negative regulatory remarks

The open interest for the March 3 options expiry is $710 million, but the actual figure will be lower since bulls became overconfident after Bitcoin traded above $25,000 on Feb. 21.

Bitcoin (BTC) was marginally positive in February even though the S&P 500 index (SPX) fell by 2.61%. On the first day of March, Bitcoin has started on a positive note while the United States equities markets are struggling. This shows that Bitcoin is trying to decouple from the U.S. equities markets.

A positive sign is that retail traders seem to have made the most of the crypto bear market. Instead of panicking and selling their holdings, traders have purchased at lower levels. Glassnode data shows that wallets holding at least one Bitcoin have consistently risen and are nearing the 1 million mark for the first time ever.

Historically, March has been a mediocre month for Bitcoin. Coinglass data shows that Bitcoin closed the month of March with double digit gains only twice in the past ten years, in 2013 and in 2021. Therefore, the possibility of continued consolidation in March remains high.

What are the critical levels that may act as major roadblocks for the recovery in Bitcoin and altcoins? Let’s study the charts of the top-10 cryptocurrencies to find out.

BTC/USDT

Bitcoin’s $22,800 level has been acting as a solid support in the past few days, which is a positive sign. This indicates that the sentiment remains bullish and traders are viewing the dips as a buying opportunity.

The price of Ether (ETH) declined 9.8% between Feb. 19 and Feb. 25 after the price resistance at $1,725 proved stronger than expected. Still, the correction was insufficient to break the 6-week-long ascending channel and did not cause Ether derivatives metrics to turn bearish.

Ether's price resilience can be partially explained by the operational failure of some of its smart contract blockchain competitors. For instance, Solana (SOL) faced a 20-hour-long outage on Feb. 25, which was only resolved after a network upgrade coordinated by validators. The network restart also involved purging some of the latest slots, although Solana developers said that "no confirmed user transactions were rolled back or impacted."

NEM (XEM) experienced a "chain halt" on Feb. 27 that lasted for 15 hours, causing multiple exchanges to halt deposits and withdrawals and developers promised to release an update to prevent further misbehavior. Curiously, the latest post from the official NEM account on Twitter, excluding a Merry Christmas greeting, was a "Please Stand By" image posted in July 2022.

The regulatory environment remains shady for cryptocurrencies, and the latest victims were global payment processing companies Visa and Mastercard. According to a Reuters report published on Feb. 28, the firms are delaying the launch of new partnerships with crypto firms until market conditions improve and a more transparent regulatory framework is established.

In more positive news, Ethereum's Sepolia testnet was successfully hard forked on Feb. 28 in preparation for the Shanghai upgrade. The much-anticipated mainnet update expected for March should finally allow validators to withdraw their staked Ether from the Beacon Chain. Developers are now prepping the Goerli testnet to enter a similar stage.