Bitcoin Price Maintains its 13% Gain, Remains Above $7,800
Bitcoin, the most dominant cryptocurrency in the global market, recorded a 15.94 percent increase in value, from $6,900 to $8,000. The price of the cryptocurrency rose by $1,100 within a 30-minute window, as massive buy volumes emerged.
Some reports suggested that bitcoin had processed the most amount of trades within a one-hour period on April 12 than any other day in its 10-year history. While this data is difficult to confirm given that the trading volume of all cryptocurrency exchanges in the global market would have to be analyzed, bitcoin has rarely seen a sudden 16 percent increase in its price, primarily because of its large market valuation and high daily trading volume.
To influence the price of bitcoin, which has a daily trading volume of above $9 billion, billions of dollars would have to be traded. More importantly, billions of dollars worth of new capital have to flow into the cryptocurrency market in order for the price of bitcoin to spike up, and bring the entire market with it.
The April 12 surge in the price of bitcoin was not caused by investors cashing out from alternative cryptocurrencies (altcoins) to bitcoin or reallocating their funds from other major cryptocurrencies to bitcoin, because the valuation of the cryptocurrency market increased by more than $20 billion.
A wave of new investors or potentially a few institutional investors likely allocated billions of dollars into the market in a short period of time, causing a short-term pump and leading the price of the cryptocurrency to surge.
It is virtually impossible to pinpoint a single factor to justify the price trend of any cryptocurrency, because a variety of factors can contribute to the momentum of a cryptocurrency. In this case, the question of whether the price of bitcoin increased due to the entrance of institutional investors or retail traders is of less importance. The crucial takeaway is that bitcoin has achieved the $7,500 support level which it had eyed throughout April, and the recent price increase could allow bitcoin to rebound to the $8,000 region with strong momentum.
On April 12, CCN reported that Pantera Capital, one of the longest lasting cryptocurrency-focused hedge funds in the global market, has called for a bottom for bitcoin and predicted the market to rebound soon to reasonable levels.
“For those who are new to Pantera who might think a fund manager like Pantera would always be saying ‘Today’s a great day to get long. I rarely have such strong conviction on timing. A wall of institutional money will drive the markets much higher,” wrote Pantera Capital CEO Dan Morehead and Augur founder Joey Krug, who also works as an executive at the hedge fund.
Investors and traders have grown tired of considering the entrance of institutional investors and retail traders as a major factor the long-term price growth of bitcoin and other cryptocurrencies. The truth is, the demand from institutional investors has been non-existent to this date. But, in April, the outlook on cryptocurrency market by retail traders have changed, following the entrance of George Soros, the Rockefeller family, and the Rothschild.
Featured image from Shutterstock.
Follow us on Telegram.