Bitcoin breaks $28k while Ethereum eyes $2k amid banking crisis

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  • The cryptocurrency market is making a comeback as the banking sector is experiencing instability.
  • Bitcoin and Ethereum reached their highest levels in nearly nine months, as fresh money poured into the market.
  • Investors have been watching the inflows of ETH as the decline could indicate higher demand for volatility.

The recent collapse of banks facing cryptocurrencies such as SVBAnd SilverjetAnd Signature It caused instability across financial sectors, leaving investors unsure of how the markets would react.

However, the cryptocurrency sector rose against expectations since the beginning of March, with the total market capitalization of cryptocurrencies rising 12.85% to $1.166 trillion on Sunday, the 19th.

This rise in value has been attributed to various factors, including better-than-expected inflation data, renewed optimism about a pessimistic Federal Reserve, and the growing importance of decentralized finance (DeFi) and digital assets.

The value of several cryptocurrencies has risen to their highest levels in nearly nine months. bitcoin (BTC) saw a 23.8% increase in March to $28,480, while Ethereum (ETH) rose nearly 15% to trade near the $1,850 level before consolidating at the $28,000 and $1,770 levels. Straight American.

Funding rates are reflected in green, indicating a bullish trend for Bitcoin

BTC held steady above $28,000, trading up 1.41% in the past 24 hours, benefiting from the current uncertainty in traditional markets in the wake of US banks such as SVB and Signature’s. recently collapsed. This event has led to renewed interest in the importance of decentralized finance (DeFi) and digital assets.

The FOMC meeting this week is expected to be a key factor in determining the direction of the market. Although Bitcoin is preparing to test the $30,000 threshold, it is likely to encounter resistance in the run-up to the event. However, there has been a noticeable increase in bullish sentiment outside the price charts.

information from Queen Glass It showed that the value of the dollar pinned to the number of open futures contracts for BTC is increasing, which indicates an increase in the speculative interest in the market and the possibility of further price fluctuations. The nominal value of open interest reached an annual high of $12 billion, recording a monthly gain of 7%.

Open interest futures chart.

Open interest futures contracts. source: Coinglass

While an increase in open interest means that new money is flowing into the market, it does not always reveal whether traders are heading for price gains or losses.

However, in the case of Bitcoin, the new money appears to be betting on price gains, given that the funding rate has flipped into the green after spending most of the early parts of the Asian trading day in the red.

Table of total open interest on BTC futures.

Total open interest on BTC futures. source: Coinglass

Favorable funding rates usually indicate an uptrend, as long positions compensate for short positions. Conversely, negative funding rates indicate bearish tendencies, as short positions receive payment from those holding long positions.

The Ethereum network shows no signs of overloading as the price increases

On Saturday, March 18, ETH price reached a high of $1,840, the highest it has been in the past seven months, surpassing levels previously seen on August 18, 2022. However, on Monday, ETH had a mixed start. To the trading day, it initially fell to $1,735 before recovering and returning to the $1,800 level.

The network has been able to handle the increased demand without encountering significant transaction barriers, which bodes well for Ethereum’s potential to continue its bullish momentum towards $2,000 in the next upgrade.

There were no new updates on Shabella upgrade On Sunday, despite the bullish session, ETH inflows were significantly lower. according to CryptoQuantinflows flows It fell from 16,192 ETH on Saturday to 9,536 ETH on Sunday, the lowest since March 5.

The metric is an important indicator as inflows could indicate higher demand for unstable ETH following the Shapella upgrade.

Graph of the total flow of the Ethereum stack.

Total staking Ethereum flow. source: CryptoQuant

on the flip side

  • Despite the recent rally in the market, there is still a lot of uncertainty in the cryptocurrency market due to its inherent volatility and lack of regulation.
  • While the growing interest in DeFi is encouraging, significant challenges remain regarding scalability, security, and ease of use.

Why should you bother

Both Bitcoin and Ethereum have seen significant price increases recently. This rise in value indicates renewed interest in the crypto market.

Since Bitcoin and Ethereum are considered to be the leading coins, their performance acts as a benchmark for the rest of the industry. It will ultimately affect the possibility of further growth in the market.

Want to know more about Bitcoin’s potential to reach $1 million? Check out this article:
Strong weekly surge of 30% in Bitcoin amid market chaos

Interested in the recent bitcoin price hike? Read more about it in this article:
$1M Bitcoin Dream: Gokhshtein to delete social networks on one condition

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