Will the cryptocurrency recover: what is the future trend of Bitcoin?

Bitcoin is the market benchmark in the cryptocurrency world. The cryptocurrency market has experienced its worst decline since the collapse driven by the COVID-19 pandemic on May 19 last year. BTC plummeted 33% in a single day, and once fell to a low of $29,000. At the same time, ETH and other important cryptocurrencies lost more than 60% of their value before bottoming out.

On Black Wednesday, derivatives exchanges liquidated positions worth 8.61 billion U.S. dollars, four times the flash crash on March 12 last year. This figure is still lower than the historical high of USD 9.795 billion set on April 18 this year.

Due to the sharp drop, several cryptocurrency exchanges including Coinbase, Binance and Huobi suffered disruptions. As a result, it is difficult for leveraged traders to provide collateral for their unstable positions, resulting in a staggering number of liquidations.

Will the cryptocurrency recover: what is the future trend of Bitcoin?

It is not impossible that Bitcoin will not return to $65,000 in the next three weeks. There are many factors at play, including regulation and the upcoming Ethereum upgrade (August 4th), which may drive price volatility

Potential threat

GBTC negative premium: Since February, shares of the largest Bitcoin fund, Grayscale Bitcoin Trust (GBTC), have been trading at a discount. With a large number of shares in the trust being unlocked, this situation is unlikely to change. Although GBTC cannot be redeemed, some investors who were supposed to buy Bitcoin on the spot market may take advantage of the price drop caused by current market conditions to continue selling.

Unstable computing power: Miners are closing their operations across China, resulting in a large number of idle mining equipment. Bitcoin mining is not suitable for people with a guilty conscience or cash shortage, but it does provide investors with the opportunity to buy Bitcoin at a lower than current market price. Whether China’s idle machinery can be used for North American operations or other emerging mining centers is uncertain. If so, there may be insufficient hosting space.

What do you think about the future of Bitcoin?

Market pauses may herald brief declines between bull market cycles. Since cryptocurrency is currently one of the biggest outlets in the financial market, the number of applications with digital asset options is growing.

Investment and banking applications will continue to introduce features that support encryption, making it easier for people to diversify their investment portfolios. This will provide a way for people to start participating in the crypto ecosystem, whether by sending Bitcoin or Ethereum to friends and family, buying NFTs, or participating in DeFi. Fintech companies and traditional banks will begin to provide more encryption products to stay competitive and bring efficiency to their businesses. Credit card points will be replaced by encrypted rewards, adding real and exciting value to customers.

As institutional adoption rates increase, all encryption projects need to operate at a higher level to compete and meet the needs of a growing customer base. We have seen payment applications such as PayPal, Venmo, and Cash App begin to support top-tier crypto assets. This is a step in the right direction to make crypto ubiquitous around the world.

There is no doubt that the new crown epidemic has accelerated the digital trend-from the shift to remote work, to the adoption of NFTs and fluctuating crypto prices. More specifically, the popularity of encrypted assets has increased dramatically. People want to obtain ownership through NFTs such as transaction cards, domain names, and digital currencies. In the past 18 months since the beginning of the epidemic, as people have become more comfortable with the use and participation of digital technologies, the trajectory of cryptocurrency has permanently shifted upwards, and the current bull market has no turning back.

 

 

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/will-the-cryptocurrency-recover-what-is-the-future-trend-of-bitcoin/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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