Bitcoin rose 1.1% on Monday, and on Tuesday morning, it “shot up” another 5.5%, adding 7.5% over the past 24 hours. This growth momentum has brought the price of the first cryptocurrency back above $20K, in stark contrast to the dynamics of falling markets and a strengthening dollar.
Ethereum added almost as much – 7% – rising to $1,385. Against this backdrop, total crypto market capitalisation jumped 5.5% to $970 billion, with top altcoins adding between 2.3% (XRP) and 8.1% (Solana).
While the Dow Jones index closed at its lowest since November 2020, the Nasdaq100 turned to growth after nearing the lows of June, and cryptocurrencies showed a strong surge. The outperformance of the riskiest assets is more typical of periods of great monetary stimulus. Therefore, the most relevant question is whether we are now seeing the first signs of a market reversal or a trap for naive bulls.
According to CoinShares, investments in cryptocurrencies rose for the second consecutive week last week. Net inflows were $8 mln, Bitcoin investments were up $3 mln, and Ethereum investments were up $7 mln. Investments in funds that allow shorts on bitcoin were down $5 mln, the first decline in 8 weeks.
Bitcoin will continue to trade in a range of $17K to $25K, Glassnode expects. Intense US Federal Reserve monetary policy pressure and an unfavourable macroeconomic climate offset any essential positive developments in the crypto industry.
Dan Morehead, CEO of crypto hedge fund Pantera Capital, believes billions of people will use blockchain in the coming years, increasing the value of cryptocurrencies.
The SEC has demonstrated that it intends to “damage or destroy the cryptocurrency industry in the US”, said LBRY, a decentralised content publishing platform.
Technology giant Apple has allowed the sale of collectable tokens (NFTs) in apps on its devices, but the commission will be 30%, sparking outrage in the crypto community.
The FxPro Analyst Team
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