Altcoins

The unexpected reasons for the rise of bitcoin and altcoins

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Sun May 5, 2024 ▪ 3 min reading ▪ by Luc Jose A.

After sowing doubt about the possibility of a post-halving rally, Bitcoin reignited the flame by reaching $63,000 on May 4. In its run, the original cryptocurrency has, as usual, attracted several other major altcoins such as ETH, SOL, CAD, etc. In 24 hours, even though trading volumes fell by almost 18%, the momentum increased the overall market capitalization of cryptocurrencies. of 5.11%. Obviously, some would like to understand what caused this trend reversal. Is it time to increase yet? Is this a deception? Details follow.

Renewed interest in Bitcoin ETFs restores confidence

JPMorgan predicted a Bitcoin Halving to $42,000. It seems that the calculations of the American bank were not very precise, because what we are currently seeing seems to be a general recovery of the markets.

The signs are clear. We saw Bitcoin hit $63,000 in 24 hours and altcoins make sustained progress since then. We also saw the overall cryptocurrency market cap reach $2.34 trillion, an increase of 5.11% in 24 hours.

This market recovery is not accidental. Indeed, thanks to recent American data which has restored investor confidence, 370 million dollars have flowed into Bitcoin ETFs. This renewed interest, after the drastic drop to $34.4 million on May 2, has significantly strengthened the market’s confidence in cryptos. This confidence was further boosted by Hong Kong acquiring 4,128 BTC in three days, having recently adopted Bitcoin and Ethereum ETFs.

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Crypto Accumulation During Downturns

The recovery of the crypto market was also caused by a change in the investment strategy of institutional clients. Indeed, as Fidelity Digital Assets recently indicated, many pension funds and wealthy individuals are showing growing interest in cryptocurrencies.

Several experts also noted that the accumulation of high-potential cryptocurrencies during periods of decline has also contributed to the general market recovery.

We understand that the combination of these factors helped to breathe new life into the cryptocurrency market, which was suffering from lethargy which lasted quite a long time. For many, now is the time to act. We hope Bitcoin will set a new record in the next six to nine months.

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Luc José A.

A graduate of Sciences Po Toulouse and holder of a blockchain consultant certification issued by Alyra, I joined the Cointribune adventure in 2019. Convinced of the potential of blockchain to transform many sectors of the economy, I took the commitment to raise awareness and inform the general public about this constantly evolving ecosystem. My goal is to enable everyone to better understand blockchain and seize the opportunities it offers. I strive every day to provide an objective analysis of current events, to decipher market trends, to relay the latest technological innovations and to put into perspective the economic and societal issues of this ongoing revolution.

DISCLAIMER

The views, thoughts and opinions expressed in this article belong solely to the author and should not be considered investment advice. Do your own research before making any investment decisions.



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