In an unexpected turn of events, bitcoin jumped up from $5,850 to $6,500 in a matter of three days which hints towards a new bullish run for the entire market.
Following the progress made by bitcoin and its new-found drive, small-time digital currencies and tokens have also risen by abnormal margins between 30 to 40 percent in the past 48 hours.
Similarly, the prices for, VeChain, a China-based digital currency, rose over 50 percent while other tokens like ICON and Ontology went through 30 percent appraisal.
According to some market experts, the crypto space has touched its lowest low or the bottom. The event occurred after prominent investors like Bart Smith, Susquehanna digital asset lead, and BitMEX CEO Arthur Hayes speculated a large drop in bitcoin’s value.
As per the popular investors, bitcoin and the whole crypto market was set to go through another correction stage before rising through a mid-term rally. They claimed that the coin needs to establish and stabilize a foundation before supporting the next bull run.
One should know that the market last went through such a recovery in April when prices for bitcoin bounced back from $5,900 to $10,000. Furthermore, the growth in valuation of the crypto space in the last three days also recorded an accelerated recovery in the value of tokens.
Between July and August, the majority of the tokens like VeChain, Ontology, and ICON suffered almost an 80 percent dip against bitcoin, which itself dropped down by 40 percent. It happened due to the amount of risk involved in high risk and high return trades due to a volatile and unstable crypto exchange market.
But, the previous three days have come as a reversal which forced a shift in the momentum of tokens. Ethereum based tokens that looked tiny against bitcoin and US dollar in July and August have experienced huge gains in the last 48 hours.
As more investors are moving their funds from stablecoins and premier cryptocurrencies to tokens, they are taking high risk moves under considerations that hint towards a solid mid-term rally.
A highly respected investor and analyst, Smith, stated that commencement of a Bitcoin exchange-traded note (ETN) in US markets is bound to attract new investors in the upcoming months.
He added, “It’s $8 million traded today (via the ETN). So, if you had that repeat in a fund over and over again, that would add up pretty quick. I would think that if this volume persisted over time that the ETN could be a big deal, but the market didn’t move, and the market is in show-me mode.”
Although, bitcoin is enjoying a new momentum yet its rise above the $7,000 mark can also conclude in another fall as noted in February, April, and June.
Even after the possible unfavorable condition, the next few weeks will support a rise in value. The increase in investments shows the degree of confidence traders now have in the asset class. It will be interesting to see whether bitcoin makes a huge return or disappoints its supporters once again.