Bitcoin and altcoins are correct after Yellen’s ‘illegal financing’ criticism

On Tuesday, Ether (ETH) experienced a bullish cut and drove the price to an all-time high at $ 1,428.

While the move may have been technical, the fundamentals for Etheruem continue to improve as less than a month after launch it now has $ 3.8 billion worth of ETH locked up on the Eth2 blockchain.

The rapid rise in price has clearly attracted the attention of pro traders but Cointelegraph analyst Marcel Pechman warns that a large rise in short positions is accompanying Ether’s rise to a new high.

ETH / USDT 4 hour chart. Source: TradingView

Ether’s break to a new high had little effect on Bitcoin’s price and critical comments from former US Federal Reserve chairman Janet Yellen appear to have had a negative impact on the broader market today.

Yellen, who has been nominated as President-Elect Biden’s Treasury Secretary, said cryptocurrencies are used “primarily for illegal financing.” He made the comments during a hearing with the Sentate Finance Committee and also advocated a major fiscal stimulus by telling Congress to “act big” when it comes to assisting for the sick US economy.

Institutions are still bullish

Daily cryptocurrency market performance. Source: Coin360

Despite today’s slight correction, institutional investors are still bullish on Bitcoin’s long-term outlook. A recent projection by hedge fund Vailshire Capital Management called for an “impending breakout” and PlanB, the creator of the popular Stock-to-Flow model, has predicted that Bitcoin’s price could close the month near $ 48,000.

Unlike the crypto market, traditional markets ended the day with strength as Yellen’s call for additional economic stimulus was viewed positively by Wall Street. The S&P 500, Dow and NASDAQ all finished the trading day off strongly following Yellen’s comments, closing up 0.81%, 0.38%, and 1.5% respectively.

BTC / USD daily chart. Source: Coin360

Despite the negative views expressed by Yellen, positive developments for several blockchain projects helped drive altcoin prices higher.

Enjin’s price (ENJ) increased 71% after the project was legally authorized for trade by the Japan Virtual Currency Exchange Association (JVCEA). Aside from Ether (ETH), the 20 best-performing coins over the last 24 hours were Bitcoin Cash (BCH), up 7.46% and trading at $ 546.

The overall cap of the cryptocurrency market is now $ 1.046 trillion and Bitcoin’s dominance rate is 65%.