Bull Trap Or Breakthrough- Find Out The Mood Of Cryptos In 2023

The beginning of 2023 for the crypto community has been no less of a joy ride. Where bitcoin on one hand has again picked up the pace, the analysts are still looking for the sharks before stepping into the pool. Surprisingly, the market investors seem confident about the performance of bitcoin, which recently surpassed the $20,000 mark and currently trades around $23,000. While altcoins such as Ethereum, Dogecoin, and more have also shown an impressive surge, the whole world is closely eyeing the bitcoin chart to see whether it will touch the $30,000 mark or not.

Awestruck by the potential of the crypto market, analysts were unable to look for a single sign of positivity for such disastrous had been the repercussions of calamitous implosions in 2022. It includes the Terra Luna Crash in May that wiped out more than $200 Billion off the crypto space, followed by the FTX Collapse in November which wiped out around $150 Billion and ultimately pushed the crypto market capitalization below the $1 Trillion mark. Despite these negative sentiments, not only did the global crypto market capitalisation regain its $1 Trillion valuation but also recovered all the losses within the first month of 2023.

Areeb Ahmad, Global Head of Blockchain & Strategy at Epillo Health Systems, weighs in the risks and opportunities that lie ahead before Bitcoin reaches the $30,000 level. According to Areeb, while the bankruptcy filed by Genesis may create fears of a global macroeconomic turmoil, it will be worth noticing whether Bitcoin gains the trust of investors as it slows down nearing the next resistance level at $24,000. Not only will Bitcoin have to maintain the multiple crucial price levels that it will form but also break through the 200-SMA (Simple Moving Average) before reaching the $30,000 level.

Other global factors that are attributed to the unprecedented surge in crypto market capitalization include the relief in inflation after surging to a 40 year high mark in 2022, followed by the prediction of cuts in the Federal Reserve’s rate hikes. Furthermore, the ‘Halving Event,’ that is to be held in 2024, is creating an uptrend that is expected to bring-in more buying pressure. Halving Event is observed every four years, where the payouts of bitcoin miners are reduced in half and so the supply, which may surge the price of Bitcoin.

Following the trail of Bitcoin, the prices of other crypto coins have also skyrocketed that includes Ethereum, BNB, Dogecoin, XRP, Cardano, Polygon, and the infamous FTX linked Solana, which has added almost 21%. The upcoming month of February is going to be crucial to fuel the rise of cryptocurrencies for the Federal Reserve Officials will gather in its first week to decide the interest rates. The traders are speculating a 25-basis point increase in interest rates.

In the big picture, it will be worth observing whether Bitcoin could maintain its trajectory and remain unscathed by the negative market sentiments amid the fears of global recession. If it does, the world will witness a new wave of crypto where more and more businesses are likely to accept it for payments. In addition to that, some of the world’s top economies, such as India, that are currently supporting a ban on crypto, may accept it with wide open arms.

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