For the first time since June 13, Bitcoin has managed to cross the milestone of $25,000 in the night from last Saturday to Sunday. However, this was only a short-lived increase as its value had fallen back to $24,510 by Sunday morning.
However brief it may have been, this surge in energy from the primary is a sign that the market is indeed picking up again, not just thanks to US inflation data fresher than expected, but also with the progress made by the big Ethereum update that was announced.
The $25,000 cap: A Key Resistance Level for Bitcoin
Very early this Sunday, the value of the largest cryptocurrency, Bitcoin, increase 2.2% to reach $25,031. A rather decisive event since Bitcoin had been stuck under $25,000 for weeks.
Since this incident, BTC has fallen again and is currently trading around $24,176 according to CoinMarketCap. According to some experts, this drop in price is again a visible sign that the $25,000 mark is still there. key resistance level for bitcoin right now. Once the latter is fully crossed, BTC should be able to develop more steadily and continuously.
After some analysis, it can be seen that Bitcoin has only seen an increase of about 5.85% over the past week, while Ethereum, the second cryptocurrency, has seen an increase of 16% over the same period. I also like the latter of significant expansion in anticipation of the upcoming merger of their network towards a model that offers more scalability and more ecology (The Merge).
Why such a sudden rise in the value of Bitcoin?
There is no denying that cryptocurrencies have gone through a lot of trouble during the first semester of this year. A situation partly related to the fact that the Federal Reserve has raised its interest rates significantly to fight stubbornly high inflation.
After this rise, there are rates, prices of Bitcoin, Ethereum and other tokens dropped more than 50% pretty fast. Several reasons can therefore explain the rise in the value of Bitcoin in the last few hours.
Last week was the US inflation data greatly inferior analyst expectations. This increase is mainly due to the cooling of the economy’s inflation.
In fact, the leading economic indicator has remained unchanged over the past month as the Federal Reserve appears to be raising interest rates to combat rising prices. Some like risky assets the Nasdaq 100 index after experiencing strong growth at the same time, some cryptocurrencies, including Bitcoin, received a positive impact after this news.
Of course, it must also be taken into account that the crypto market is quite weak and that investor confidence has been affected at certain points, especially with the fall of Terra Luna Last May.
What is the future for Bitcoin and the cryptocurrency market?
It is the entire market of the global economy, from assets such as stocks and bonds to cryptocurrencies such as Bitcoin, that has been greatly affected. the rise in inflation. It hasn’t helped that a potential global recession is really on the horizon. Bitcoin, long considered an excellent hedge against the inflationary crisis, has put its reputation as “anti-inflationary digital gold” to the test this year.
Fortunately, the slowing rate of inflation could pave the way for less aggressive tightening measures from the Federal Reserve. This increase, albeit short, represents the wedge above the $25,000 mark especially comfortable development for many in the cryptocurrency community have been watching prices drop since the beginning of the year.
For the billionaire investor Mike Novograt, the crisis is already over in the industry. According to him, although it is true that the problems facing the market at the moment have definitely increased investor mistrust, the argument for Bitcoin is still going strong. It is still the number 1 asset on the market and is hard to ignore.
However, it should be noted that Bitcoin is still down 64% against the recent encouraging signs of a possible encouraging rebound. the historical level 69,044.77 which he was able to achieve in November 2021.
Will Bitcoin manage to get closer to its record value? For some like CZ (Changpeng Zhao), the CEO of Binance it is clear, even if it will take time and for others like Peter Schiff Bitcoin will fall.