The last 24 hours have been quite exciting for crypto hodlers as digital currencies have been rallying with some registering as much as 50% weekly gains.
Most of the news pertains to the OG cryptocurrency Bitcoin whose price performance tends to influence the price performance of the rest of the crypto market. It is therefore helping propel the marketwide bullishness. Let’s dive into some of the major factors that are fueling the current bullishness.
One of the earliest catalysts in the last few days was the news that El Salvador is adopting the cryptocurrency and that the government will conduct an airdrop of $30 to every registered citizen with a BTC wallet. While the airdrop amount is low, it could have a massive positive implication as an incentive to encourage people to shift to digital currency. Another implication is that more countries will likely follow in the same footsteps.
Some more recent news reveals that investment banking giant Morgan Stanley has acquired roughly 28,000 shares of Grayscale. The latter is one of the institutional buyers that have been buying up a lot of Bitcoin. The share acquisition suggests that Morgan Stanley is looking to benefit from the crypto bull market.
Such a move is great news for the market because it not only signifies the expectations of a continued bull run but also the fact that traditional financial institutions are circumventing regulations to get in on the action.
Ark Invest has in the last few years solidified its position as one of the best investment firms in the market. It is therefore a big deal that the investment firm is planning to launch a Bitcoin ETF, thus joining the list of other companies such as Galaxy Digital, First Trust Advisors, and others that are currently competing to launch the first regulatory approved Bitcoin ETF.
There have also been other reports that highlight Bitcoin’s increased adoption. For example, recent reports suggest that a Nigerian private school will start accepting school fees in Bitcoin. This means that the cryptocurrency market has now reached a new frontier as far as adoption is concerned.
The influx of positive news is responsible for the ongoing bullishness especially now that the market is recovering from a bearish situation in the last few weeks, during which Bitcoin dropped to $28,805. Bitcoin has been steadily rising from that low and is currently trading at around $35,000.
Source- Binance
If Bitcoin can continue on this path, it will have to face key resistance levels at around $39,100 and $42,000, unless some FUD develops along the way, triggering some more sell-offs. While the latest news had a positive impact on the price of Bitcoin, the altcoin market enjoyed the most gains. Some of the top gainers such as Shiba Inu soared by as much as 17.55% and Bitcoin Cash which rallied by as much as 13% within a 24-hour period.
It is abundantly clear that FUD is an impressive tool for market manipulation. In most cases, it acts as a shakedown for paper hands while providing an opportunity for accumulation during the dips. However, there is still some risk of losses in case the market crashes, in which case it would take some time before prices recover. Caution is thus necessary and the uncertainty in the market means nothing is written in stone. Drastic changes may occur at any given time.
Sydney has 20+ years commercial experience and has spent the last 10 years working in the online marketing arena and was the CMO for a large FX brokerage.
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