Briefly: Is crypto winter showing signs of ending? Although most token prices are nowhere near what they were at the beginning of last year and many companies are laying off workers, Bitcoin has seen a slight rebound since the beginning of 2023, reaching its highest level since November.
Bitcoin finally crossed the $20,000 mark over the weekend, after retreating from that milestone since the beginning of November. BTC is currently at $21,161, and although that’s about $20,000 lower than it was 12 months ago and far from the all-time high of $69,000, it’s still a positive sign for investors who have been through the toughest year in crypto. Until now.
The crypto winter began last year when TerraUSD crashed in May and was exacerbated by the implosion FTX exchange. In addition to the decline in the prices of digital assets, including NFTs, last year witnessed LawsuitsAnd Bankruptciesand thousands of job loss across the industry.
Some analysts fear that things will get worse in 2023, with Bitcoin forecasts dropping to $10,000 or even $5,000. Others have a more positive view, believing that Bitcoin will rebound to $50,000 this year. One very optimistic venture capitalist thinks so It will come to $250,000which would represent an increase of about 1,400%.
As Bitcoin gets closer to work, it’s starting to look like the naysayers can be proven wrong. CNBC reports Analysts put the recovery down on two main factors, the first being the possibility that central banks will ease the pace of interest rate hikes, or even cut interest rates, as inflation slows – CPI fell 0.1% in December.
Another important factor is said to be the “whales”, those who buy large amounts of BTC: only 97 wallet addresses control 14.15% of all Bitcoin. Crypto data firm Kaiko writes that the recent increase in average trade volume indicates renewed confidence in the market by whales.
Another effect is said to be halving – an event that happens every four years in which the bitcoin mining reward is halved. This is expected to drive up the price of BTC, and although the next halving does not happen until 2024, it is already generating more confidence in the future among investors.
The truth, of course, is that the Bitcoin price is unpredictable. Any resurgence is good news for buyers and sellers, there are a lot of positive signs, and it looks like we are past the worst of the cryptocurrency winter, but things can change very quickly in the cryptocurrency world.