The crypto was recently trading at nearly $27,800, more than 5 per cent lower during the last 24 hours

Bitcoin began the U.S. trading week edging below $28k – the continuation of a sliding spiral that began on Sunday as federal regulators readied to gain control of First Republic Bank.

The crypto was recently trading at nearly $27,800, more than 5 per cent lower during the last 24 hours, as per CoinDesk data. Bitcoin had been staying near $28,500 as U.S. markets opened and it was announced banking giant JPMorgan had won the auction to buy assets of First Republic.

Edward Moya, senior market analyst for foreign exchange trader Oanda, proposed in a note that the quick reaction to First Republic’s collapse demonstrated the banking sector was ready to address these kinds of failures. Wall Street may have become confident that broader banking crisis has been “removed from the table,” he stated.

It appears the U.S. banking system has a playbook to tackle the next banking crisis when it comes up, which is somewhat diminishing the case for cryptos, Moya stated.

San Francisco-based First Republic is the fourth bank to collapse in the last two months, after Silvergate, Silicon Valley and Signature banks.

Ether followed a similar pattern to bitcoin, declining over 4 per cent to trade at nearly $1,813 Monday afternoon.

Equities were closing lower Monday, with the S&P 500 0.04 per cent lower. Both the Dow Jones Industrial Average (DJIA) and Nasdaq Composite recently dropped 0.1 per cent.

Investors will focus on the FOMC monetary policy meeting, which starts Tuesday to decide whether to raise interest rates and by how much. The CME’s FedWatch tool at present sets the probability of a 25bps raise at over 94 per cent, which would strengthen the target range to between 5 per cent and 5.25 per cent.

Some experts anticipated the decision may result in price variations in the crypto market.

After a breakout (bitcoin above $25k), it is necessary to pay heed to retreats to determine the buy strength remaining, Blockware Solutions experts stated on Friday. In this case, bitcoin flashed some quite bullish signals, as buyers rapidly stepped in at the 50-day (simple moving average).

Blockware Solutions’ experts said bitcoin has strong resistance between $30k and $31k, even though they noted that it is not unreasonable to suppose that the FOMC policy decision could make or break current strength of bitcoin.