On Monday, Bitcoin surpassed $41,000, reaching levels not observed since the cryptocurrency stablecoin TerraUSD collapsed in May 2022.
The cryptocurrency industry eagerly awaits the upcoming Bitcoin halving event, anticipating significant changes. Simultaneously, industry stakeholders hope for approval from the U.S. Securities and Exchange Commission (SEC) is considering a spot Bitcoin exchange-traded fund. Despite these regulatory considerations, the price of Bitcoin continues to rise steadily.
Moreover, Coinglass, a company that analyzes cryptocurrency derivative data, reports the liquidation of Bitcoin short positions valued at over $109 million in the last 24 hours. This significant development underscores the dynamic nature of the cryptocurrency market. Additionally, the swift liquidation of these positions may influence market sentiment. Investors, however, should remain vigilant and consider potential fluctuations in the market. Furthermore, such events often trigger increased scrutiny and regulatory attention. Consequently, it becomes crucial for market participants to adapt and respond promptly to emerging trends.
Simultaneously, a record high, surpassing $2,115, was recently reached by gold. Moreover, supporters claim Bitcoin is like “digital gold,” serving as a stable store of value for the long term. This comparison reflects the belief among enthusiasts in Bitcoin’s enduring worth and stability. Consequently, a positive connection between these two assets often suggests that Bitcoin is gaining broader acceptance. It moves closer to its goal accordingly. This, in turn, signifies a significant milestone for the cryptocurrency.
About Bitcoin
Bitcoin, the inaugural cryptocurrency, made its debut in 2009. Employing peer-to-peer technology, digital tokens like Bitcoin facilitate immediate payments without relying on intermediaries like banks. This revolutionary idea was first presented by Satoshi Nakamoto, the anonymous developer of the currency.
Other than traditional money, cryptocurrencies serve a dual purpose—facilitating online transactions and functioning as investment assets similar to stocks. However, financial firm Charles Schwab emphasizes that investing in cryptocurrencies carries inherent risks due to their well-known price volatility. It’s crucial to note this aspect.
Moreover, while there are more than 11,000 cryptocurrencies, bitcoin stands out as the most valuable in dollar terms. According to CoinGecko, a cryptocurrency price tracker, it holds the largest market capitalization among all digital assets.
Bitcoin Price Prediction – Cryptocurrency Surges
Moreover, Bitcoin broke through the $40,000 barrier and continued to rise at the beginning of the trading week. This rise indicates positive momentum in the cryptocurrency market. Investors closely monitor these developments, considering potential opportunities and risks. Additionally, the ongoing rise reflects the dynamic nature of currency’s value. Consequently, market participants are adjusting their strategies in response to this upward trend.
Bitcoin rose above the $40,000 mark during the Monday trading session. This increase is directly linked to traders’ expectations of a Federal Reserve rate drop in March. Furthermore, there is speculation surrounding heightened Bitcoin demand through ETF markets following SEC clearance. However, the underlying purpose of currency is still under investigation, leaving the realization of these expectations uncertain.
From a technical analyst’s perspective, momentum will likely persist after this significant move. Anticipating the transformation of the $40,000 resistance level into a significant support area is based on market memory. Consequently, traders could potentially re-enter the market in the event of a decline, presenting a favorable opportunity. Although a substantial decline is improbable, reaching the $45,000 mark seems only a matter of time.
Turning attention to interest rates in America, a potential increase could negatively impact cryptocurrency. Simultaneously, current indications suggest the bond market is pressuring the Federal Reserve to expedite rate reductions. Subsequently, a significant influx of “cheap and easy money” into cryptocurrency markets may reignite interest in highly volatile assets. Nevertheless, the growing involvement of institutions may temper the strength and volatility of the next wave of cryptocurrency bull markets.
Bitcoin Hits $40,000, Reaches 2023’s Peak
On Monday, December 4, bitcoin gained 2.66 percent on the cryptocurrency price chart. It reached its highest value in 2023 at $40,578 (about Rs. 33.7 lakh). Furthermore, Bitcoin’s weekend increase amounted to $2,854 (about Rs. 2.37 lakh). As a result, currency now dominates 52.4 percent of the market. It has minimal impact on other listed cryptocurrencies.
In comparison, Ether’s value increased by 2.53 percent, reaching $2,214 (about Rs. 1.84 lakh). Over the weekend, Ether’s price rose by $125 (about Rs. 10,400). Moreover, according to information shared with Gadgets360 by the CoinSwitch markets desk, the cryptocurrency reached its highest price since April 2022. Consequently, traders are advised to caution, considering historical December trends that suggest potential peaks or troughs for cryptocurrency.
Other Cryptocurrencies Gained
In addition to Bitcoin and Ether, other cryptocurrencies also gained. Litecoin, Cardano, Tron, Polygon, and Ripple all showed positive movement. Modest gains were observed in Shiba Inu, Bitcoin Cash, Cosmos, Stellar, Near Protocol, and Elrond.
Edul Patel, CEO, and co-founder of Mudrex, attributes the price rise to a bullish attitude. He points to expectations of favorable developments in 2024. In particular, he highlights the approaching bitcoin halving and the anticipated US launch of a cryptocurrency Spot ETF. Notably, Bitcoin’s price has surged by over 140% since the beginning of the year.
Shifting focus, on the last day, the total cryptocurrency market value increased by 2.76 percent to $1.52 trillion. This marks the highest valuation of the year.
Cryptocurrencies in Decline
Simultaneously, Tether, USD Coin, Dogecoin, Chainlink, Avalanche, Binance Coin, and Solana are cryptocurrencies facing losses. They are experiencing a decline in value. Moreover, according to WazirX Vice President Rajagopal Menon, traders actively place top-side options. They speculate on an imminent rate cut and increasing confidence in Bitcoin ETF applications. Consequently, this speculation may potentially propel cryptocurrency to $45,000 by March 2024.
Why Bitcoin Is Rising Rapidly
Currency’s recent surge is propelled by various factors. Major investment firms are on the brink of obtaining regulatory approval for spot bitcoin exchange-traded funds (ETFs). This development serves as a significant catalyst. Moreover, these ETFs, akin to stocks, are expected to gain approval from federal regulators as early as January. This development has the potential to broaden accessibility to crypto investments for both retail and institutional investors. According to Yiannis Giokas, a senior product director at Moody’s, this signifies a positive step in the market.
Anticipating increased participation in the Bitcoin spot ETF space, Giokas expects more investment managers to enter. This shift is likely to make the market more inviting for a broader range of investors, including more conservative ones. Subsequently, this transition is expected to enhance the overall appeal of crypto investments.
Additionally, as per Wall Street, currency prices benefit from the expectation that the Federal Reserve is concluding its interest rate hikes. This anticipation contributes to the positive momentum in the currency prices. There is foresight indicating a potential shift towards loosening monetary policy by mid-2024 to sustain economic stability amid receding inflation. Simultaneously, this strategic adjustment is seen as a response to changing economic conditions.
During periods of declining interest rates, investors typically redirect funds into riskier assets like cryptocurrencies. This redirection contributes significantly to the positive momentum in cryptocurrency prices. Greg Magadini, director of derivatives at crypto data firm Amberdata, notes that “lower rates are bullish for bitcoin.”
Giokas envisions 2024 as a promising year for the currency, reflecting its role as a proxy for the overall crypto market. This optimistic outlook is based on historical patterns and the potential for another upward trend.
