For three days since June 25, there has been no shift in the cryptocurrency market on both downside and upside. The market has been steady at the $250 billion region and with bitcoin’s volume remaining at $3.2 billion. There is the likelihood that in the short term, the market will not sustain its present evaluation.
Strong Volume Is A Requirement for Remedial Rally
An advantageous spike for main and minor cryptocurrencies requires strong volume. And momentum as indicated by the remedial rallies that occurred in May and June. The probability of major cryptocurrencies increasing in upcoming days has been reduced. It happened due to its low volume as the cryptocurrency market has been steady at the $250 billion region.
The daily trading volume for the native cryptocurrency of Ethereum blockchain, Ether was over $2 billion on June 25. On June 28, the trading volume reduced to below $1.3 billion and it has remained there. This trading volume is approximately a billion dollars lower than the Tether cryptocurrency. Its value is attached to that of the US dollar.
Presently, there is no sufficient volume that will commence a remedial rally even if the market experiences a demand spike and positive momentum interest. There is a likelihood that in the short term, the market will drop by a small boundary rather than increasing on the upside. With the rate of things, there is the likelihood that in the short-term, the price of bitcoin could reduce to $5,800. This likelihood will increase if bitcoin’s daily volume does not increase by a large margin in the next two days. Since June 25, bitcoin’s price and volume action have reduced so there is a possibility for a yearly drop.
Bitcoin ETF Emergence
An influx of new money and capital into the cryptocurrency market for main cryptocurrencies like Ethereum as well as minor assets this week has been noted by prominent investors and analysts. This influx of new money is to help increase the price and volume.
John Hyland the head of exchange-traded products in Bitwise Asset Management global stated earlier this month that the US Securities and Exchange Commission (SEC) is set to support a bitcoin exchange-traded fund. Hyland stated that the emergence of trusted custodian solutions is a driving force for the bitcoin ETF emergence. He listed a number of reasons why the bitcoin ETF is close to emerging, the first is custody.
Most private fund’s crypto assets have custody with a small controlled custodian. Hyland stated that although the top five ETF custodian is looking. They are not yet interested in offering this service. He continued saying that the way forward will be to hire sub-custodians who will help solve the SEC issue.
For an increase in BTC and cryptocurrency market to experience an increase in the upside, the ETF’s new capital, custodian solutions and publicly traded instruments will have to enter into the cryptocurrency market.