The Bitcoin price has crossed the $50 thousand mark for the first time since 2021. The cryptocurrency continues to grow for the seventh day in a row. This is the longest cycle since January 2023, Bloomberg reports. Experts note that this was a consequence of the entry into the market of nine spot exchange-traded funds based on this digital asset. In just a month, they raised $9.5 billion. In addition, the quotes are also affected by the so-called Bitcoin halving, that is, a reduction in the number of tokens by half. This happens once every four years, and approximately the next reduction will occur in April 2024.
Therefore, Bitcoin will still strengthen its position, although investing now is already risky, says crypto expert and former head of Binance in Russia Vladimir Smerkis: “Bitcoin always remains a very volatile instrument, and, of course, it is very dangerous to purchase it now, despite the fact that ETFs are buying this asset is quite active. This is the No. 1 reason we are seeing in the market right now. The second reason is the expectation of halving, when miners will begin to receive half the commission for their work.
Now we must admit that Bitcoin is becoming more and more centralized, that is, strong long-term investors are starting to buy it, but the volatility also hides the possibility of manipulation.
Still, large players who own a large volume of bitcoins can influence the number of coins they own, in particular, make various sales and many other activities. So here you also need to be extremely careful.
In addition, I now see a large number of different forecasts that Bitcoin will cost $120 thousand after the halving. Changpeng Zhao, the founder of the Binance exchange, who was fined in the United States of America, once said that after halving the effect is not always immediately noticeable. So we will still see jumps, as well as a correction, especially after such a long growth.
But overall the trend for Bitcoin is very, very positive. It is also helped by technological factors, particularly around its ecosystem. We are also talking about the blockchain of this cryptocurrency; there are a huge number of enthusiasts who make add-ons to it. If earlier Bitcoin was immobile and very conservative, now technological innovations are coming to its ecosystem.”
On February 12, other crypto assets from the top 10 by capitalization were also in the green zone; in particular, Ethereum was trading above $2.5 thousand per unit. And in general, there is more confidence in digital currencies in the market, but even despite the arrival of institutional money, this does not protect against volatility, the founder of the service for accounting, control and analytics of cryptocurrencies BitOK Dmitry Machikhin is sure:
“The influx of institutional money still goes into derivatives, into ETFs, and not into Bitcoin itself, this needs to be understood. Of course, ETF service providers have a custodian who must hold this number of Bitcoins. But I don’t yet see a serious connection between these markets.
Yes, volumes are growing, yes, there is generally more trust, and there is direct access to institutional money. But the pressure that Bitcoin and other cryptocurrencies may be under is different. And, in fact, there are growth factors. Therefore, it is too early to rejoice.
If we analyze previous cycles before halving, for example, the price is more likely to go down than up. The current growth may last up to $55 thousand and up to $56 thousand, but halving still brings with it some kind of correction. Someone says that Bitcoin technically cannot fall below $30 thousand. So we’ll see.”
In 2021, after the price of Bitcoin exceeded $64 thousand, over the next month the quotes fell to $47 thousand, and a month later - to $35 thousand.
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