Bitcoin
Has the Crypto Bull Run Begun or Is It Just a Bull Trap? Here’s What to Expect Next
BitcoinOin has surged above $63,000 after a prolonged drop to $54,000, and other cryptocurrencies like Ethereum and Solana are also showing signs of a potential bull run. This resurgence has led to speculation whether the market is poised for another significant rally.
The total cryptocurrency market cap has surged by over 4% in the past 24 hours, reaching approximately $2.41 trillion. This surge follows weeks of bearish momentum, with Bitcoin finally gaining momentum. BTC reached a daily high of around $63,000 before settling at $62,700. Ethereum (ETH) also saw an increase of more than 4%, hovering around US$3,347.
Factors fueling the rise of cryptocurrencies
Several bullish factors are driving this surge. First, the German government has run out of Bitcoin to sell after offloading 50,000 BTC seized from pirated movie site ‘Movie2k’. Additionally, Donald Trump’s chances of winning the presidential election seem stronger than ever, especially after an alleged assassination attempt. Trump’s scheduled address to the crypto community at the Bitcoin 2024 Conference in Nashville further boosts confidence.
Recent US Consumer Price Index (CPI) inflation data and figures indicate cooling inflation, which could lead to interest rate cuts by the Federal Reserve in 2024. The imminent release of Ethereum ETFs in Spotlight is expected to create a supply crunch for ETH. Cryptocurrency investment products saw massive inflows of $1.44 billion last week, suggesting a positive shift in sentiment. Institutional investors remain bullish, with Standard Chartered maintaining a $150,000 price target for Bitcoin by the end of 2024.
The SEC appears to be losing its regulatory grip on the cryptocurrency sector, with several high-profile investigations dropped this year.
Growing investment and network activity
Cryptocurrency venture funding continues to grow, with $3.6 billion deployed in Q2 2024 across 521 projects. Activity on the Solana network is also increasing despite recent market pullbacks.
Low concerns
Despite the positive sentiment in the market, there are some concerns. The ongoing multi-billion dollar payout from Mt. Gox is likely to continue for another two months, adding more Bitcoin to the market. Additionally, Genesis has started liquidating assets for a $3 billion payout plan, which could also impact the market.
Some industry insiders, such as Arthur Hayes, believe that Trump’s support for the crypto industry is disingenuous and will wane once he is elected. Despite the hopeful outlook for interest rate cuts, the Federal Reserve remains aggressive, and cuts are not guaranteed this year.
Bitcoin and major altcoins are still well below their all-time highs and require significant momentum to break above these levels. The altcoin sector continues to struggle with large token unlocks, with hundreds of millions of tokens set to unlock in July.
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With both factors pulling the price triggers, it will be interesting to see which direction BTC moves next. Will this be the start of another crypto boom? Only time will tell.