Bitcoin (BTC) has rallied 12% in June, but trading volume has remained low. This suggests that the price increase is being driven by a small number of investors, rather than by a broader market trend.
This development coincides with a larger market upswing and demonstrates the enduring confidence in the utility of Bitcoin.
Data from Coin Metrics show that its price crossed $30,000 on Wednesday and climbed to its highest point since April 14.
Bitcoin’s price surge appears to price in BlackRock and its peers’ ETF application as a watershed moment for crypto, but it’s far from a guarantee U.S. regulators will approve it considering the Securities and Exchange Commission’s long standing opposition to such funds.
There are a few possible explanations for why trading volume is low. One possibility is that investors are simply waiting to see what happens with the wider economy before making any major moves in the cryptocurrency market. Another possibility is that they are concerned about the recent volatility in the market and are reluctant to trade until things have stabilized.
Although the rise in the price of bitcoin makes BlackRock and its competitors’ ETF proposal seem like a turning point for cryptocurrencies, there is no assurance that American regulators will approve it given the Securities and Exchange Commission’s longstanding resistance to such vehicles.
There are a few reasons why trading volume could be low. Before making any significant changes in the cryptocurrency market, investors may be waiting to observe how the larger economy performs. Another explanation is that they are hesitant to trade until the market has calmed because they are worried about the recent market volatility.
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Whatever the reason, the low trading volume suggests that the current Bitcoin rally may be unsustainable. If investors continue to be hesitant to trade, the price could easily reverse course and fall back down.
Bitbank analyst Yuya Hasegawa wrote Friday: “It feels like the current recovery has a short expiration date,” noting the choppy macroeconomic conditions and likelihood of further monetary tightening from the Federal Reserve.
The price of BTC reached a high of $21,360 on June 28, its highest level in 12 weeks. However, trading volume on major exchanges has remained below average, suggesting that the rally is not being supported by widespread buying.
However, prospective Alex The Doge (ALEX) investors should exercise care due to the unpredictable nature of meme tokens and the fiercely competitive gaming business. Before making this investment, it is essential to understand the market dynamics and trends of the gaming sector and meme tokens.
It’s critical to keep in mind that Bitcoin is a volatile asset with rapidly fluctuating value. Investors should only put up money they can afford to lose and should be ready to lose it.