2024-02-23 20:04:17
According to some analysts, the crash may occur even before the halving event and the price of Bitcoin may fall to $45,000. However, there is no real cause for concern.
The week’s most important cryptocurrency news in one place
The Supreme Court in Podgorica has reportedly rejected South Korea’s extradition request for Do Kwon. The co-founder of Terraform Labs will reportedly be transferred to the United States. Kwon has been in Montenegro since his arrest in March 2023, where he tried to avoid justice with his lawyers.
Popular journalist Tucker Carlson recently blew up the internet with his interview with Vladimir Putin. The American editor and media personality, famous for his divisive views, now wanted to interview the former Prime Minister of the United Kingdom, but he would only do it for $1 million, gold or Bitcoin.
Circle, the issuer of the US dollar-pegged stablecoin USDC, recently announced that it will no longer support the USDC token on the Tron blockchain. According to Circle’s official decision, the decision was made as part of their risk management program.
At midnight on February 20, 2024, the Binance trading competition organized exclusively for Hungarian users. About the competition Binance a complete update of its website, application and desktop application, thanks to which everything on the world’s most popular centralized crypto exchange became available in Hungarian. Contest begins on February 20, 2024 and ends on March 20, 2024. Event rules, conditions and details at the link below are available.
A SECQuarterly returns filed with Reddit show that Reddit invested in Bitcoin and Ethereum last year. According to the announcement, the company also bought ETH and one of the network’s layer 2 tokens, Polygon (MATIC).
“We love and hold digital assets, cryptocurrencies that our products and engineering teams can use. However, the use of cryptocurrencies is limited to specific uses,” the company said.
Retail investors have appeared on the crypto market
A JPMorgan (JPM) according to Thursday’s report retail investors are likely responsible for the strong February crypto market performance.
The world’s largest cryptocurrency, Bitcoin (BTC), has gained 30% in price over the past 30 days.
The resurgence of retail momentum can be traced back to three main crypto-catalysts:
- for the bitcoin halving event,
- for the next major upgrade of the Ethereum network and
- for approval by spot ether ETFs
According to JPMorgan, the first two catalysts have already been largely priced in by the market, while the bank sees only a 50% chance of the third one being fulfilled, which analysts expect by May.
This population impulse can also be seen in Bitcoin flows within the chain. A larger movement was now reported from the smaller wallets, which shows the participation of retail investors.
The bank notes that retail-focused platforms such as Block ( SQ ), PayPal ( PYPL ), and Robinhood ( HOOD ) all saw increases in trading activity and investor capital inflows in Q4 2023. Crypto exchange Coinbase (COIN) also saw an increase in retail investor trading activity during the same period.
Bitcoin may be facing a 20% drop right now
Bitcoin has been moving within a narrow corridor for more than a week, with $52,000 acting as a strong resistance zone.
While this has taken a toll on the general public sentiment – as well as affecting the price performance of altcoins – seasoned market observers remain optimistic.
Analyzing past records, analyst Rekt Capital identified the key phases that were common in the construction of previous bull market trends.
“In the past, the macro-level decline always preceded the upside near the halving”
Then comes a pre-halving retracement, followed by a post-halving re-accumulation period, and finally the parabolic price action that pushes Bitcoin to new all-time highs.
The attached monthly chart shows that BTC/USD has broken its initial downtrend line, but has entered a previously formed resistance zone. A retest of support following the breakout, which is actually the pre-halving retracement phase, is what is missing in 2024 for now.
“The same will be expected in this cycle,” continued Rekt Capital.
So the question now is when can Bitcoin retest the $45k resistance in the pre-halving period?
Earlier, Rekt Capital concluded that BTC/USD has already fully entered the pre-halving rally. At the time, he added, key currency events are occurring more quickly in this cycle than before.
Although the upward trend definitely remained intact in the long term, important support levels have now re-entered the picture if we look at the shorter time frame.
The 88- and 100-period exponential moving averages (EMA) on the four-hour chart are at $50,017 and $49,654, respectively, along with the 18-period EMA at $49,645. And of course the psychological level of $50,000.
Currently, the exchange rate is at the lower level of the range, which can typically be the inflection point of a short-term trend. This is where buyers and sellers will likely fight the most for control.
However, there is no reason to panic
However, there is no reason to panic. The significance of the 0.618 Fibonacci retracement level from the all-time high is just above $48,000. Thus, even in the most extreme case, the price of Bitcoin can fall by a maximum of 20% compared to the peak following the launch of ETFs.
If BTC price goes below $49,000, the picture may change, but the consolidation of the uptrend is actually favorable for the continuation of the uptrend.
Pantera, the $4 billion venture capital fund, is counting on a convergence of positive factors to fuel the next bull market.
Pantera has identified the current phase as the start of the fourth major cycle and predicts a potentially strong uptrend for cryptocurrencies over the next 18-24 months.
In his latest investor analysis, he pointed out that the current moment is a significant opportunity for Bitcoin, whose future potential value is estimated at half a trillion dollars.
The hedge fund predicts that if Bitcoin’s decentralized finance (DeFi) reaches Ethereum-like proportions, the total value of DeFi applications might reach $225 billion, accounting for 25% of Bitcoin’s market capitalization. This estimate ranges from $72 billion to $450 billion, depending on the capital base, and assumes that Bitcoin’s current market capitalization remains unchanged.
“Bitcoin’s neglected era is finally coming to an end. In the post-ETF era, Wall Street has finally realized that there is a new asset, Bitcoin. The next era will be regarding technology and a rekindled excitement to build Bitcoin even bigger together.”
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