- In a surprising development, the world’s largest cryptocurrency, Bitcoin, demonstrated a strong trend change on Wednesday, reaching up to $38,000.
- According to analysts, the nearing completion of the Federal Reserve’s interest rate hike cycles could provide significant support to crypto prices.
- There is speculation among investors about whether Bitcoin has already priced in the expected effects of spot ETFs on this year’s rally.
Bitcoin price, despite the SEC’s strict stance, showed a strong price increase and approached $38,000. Now, how will the BTC price progress?
Bitcoin Price Nears $38,000
In a surprising development, the world’s largest cryptocurrency, Bitcoin, demonstrated a strong trend change on Wednesday, reaching up to $38,000. This marks the first time in the last 18 months since May 2022 that Bitcoin has reached these price levels.
This development occurred despite the SEC’s decision to postpone the approval of the spot Bitcoin ETF. The introduction of ETFs will simplify access to Bitcoin for both institutional and retail investors, potentially leading to significant fund inflows into the asset class.
Bitcoin gained approximately 6% in the last 24 hours, reaching $37,350 at the time of writing. This brings its total recovery since the 2022 drop to 129% up to the beginning of the year. Meanwhile, altcoins, including the second-ranked Ether, also experienced upward movement.
According to analysts, the nearing completion of the Federal Reserve’s interest rate hike cycles could provide significant support to crypto prices. Zach Pandl, the research director at crypto fund provider Grayscale Investments LLC, wrote the following in a note to investors:
“The recovery in crypto valuations can continue if real interest rates peak and progress continues toward spot ETF approvals in the U.S.”
A puzzle for investors revolves around whether Bitcoin has already priced in the expected effects of spot ETFs on this year’s rally. Approval may be “priced in,” but the critical question is the extent to which ETFs will generate fund inflows, according to many market analysts.
Where Is the BTC Price Heading?
Well, Bitcoin is exhibiting good volatility after facing selling pressure around $35,000 earlier this week. According to analysts, given that the BTC price is currently above critical support levels at $36,000, it has the potential to rise to $43,000 and beyond in the coming weeks.
Moreover, on-chain data indicates robust activity on the Bitcoin network. According to Santiment, Bitcoin’s Network Value to Transaction (NVT) ratio has shown a notable improvement, considered a key signal for crypto market fundamentals by traders. This metric evaluates the health of the network by comparing the circulating unique BTC amount to current market value levels.
