Bitcoin, the largest cryptocurrency by market capital, has risen to 40% since the collapses of several highly-regarded global financial institutions.
After the fall of Silicon Valley Bank, First Republic Bank and Silvergate, investors’ distrust in the banking sector led to cryptocurrency surpassing $28,000 for the first time since June 2022.
The CoinDCX Research Team has compiled the following information about the current cryptocurrency rally and the future prospects for it.
“Bitcoin has seen a dramatic rise in value over recent weeks, with its price rising by more that 28% in the past week, and trading at $28,000. After six to eight months, the BTC dominance reached an all-time high 44.4 percent.
According to Business Today, the sudden price rise can be attributed to a variety of factors including the long-term trend in accumulation at lows below $20,000, and the liquidity crisis facing the banking sector.
Parth Chaturvedi (Crypto Ecosystem Lead, CoinSwitch) explained that volatility in digital currency is possible despite the rally.
“It was heartwarming for the crypto market to rise against all odds last Wednesday. He said that Bitcoin (BTC), despite the sell-offs of global equities, and other ‘risky assets’, finally broke out from the $20,000-25,000 range it had been trading in for weeks.
He said, “But, caution is still the best thing as news from the banking sector can still have an impact on market sentiments.” Banks may find it more difficult to process crypto-related transactions as regulators continue to block them, as was the case with Signature Bank. The Fed’s Wednesday meeting is another thing to watch out for.
The CoinDCX Research Team discussed the outlook for crypto tokens. “In the wake of these, more investors might currently consider Bitcoin to be a safe haven investment. This could lead to Bitcoin’s future value exceeding $30,000 in the short-term.
In the coming days, crypto projects like ETH, MATIC and LIDO Finance will see significant traction.
According to CoinMarketCap data, Bitcoin traded at $27.561 on Tuesday.