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Bitcoin stabilizes at $50,000 Yesterday, Bitcoin once again showed a strong upward trend, breaking through the $50,000 mark and reaching a high of $52,600. Since then, it has basically stabilized at the key position of $50,000. The $50,000 level is the ultimate direction of all technical indicators. If it can hold steady, it will indicate that the market trend is beginning to become clear and bullish sentiment will dominate, thus ending the current market confusion caused by the previous sharp decline and basically determining the direction. Influenced by the rise of Bitcoin, cryptocurrencies showed a general upward trend: 91 of the top 100 tokens by market value rose and only 9 fell; almost all related concept projects also rose, and the increase was not small, with the lowest increase being more than 5%. The recovery of Bitcoin's market is closely related to the performance of mainstream finance, and the trend of US stocks has a great impact on its market.
Yesterday, the trend of rising U.S. bond interest rates and falling U.S. stocks once again reinforced the positive impact of inflation expectations on Bitcoin. This is an important indicator that supports the bull market of Bitcoin.
Under the pressure of the mainstream economy, institutions and individuals have shown a more friendly attitude towards Bitcoin. Recently, some survey data on cryptocurrencies indicate this trend:
According to a recent survey conducted by Blind, an anonymous professional network for technology professionals, 50% of professionals "trust" cryptocurrency, while 57% currently own cryptocurrency. The survey asked 1,800 respondents, who are employees of Twitter, Amazon, JPMorgan Chase and various other companies.
In addition, according to U.Today, a recent survey conducted by JPMorgan showed that 7% of institutional investors believe that cryptocurrency may eventually become one of the "most important" assets. The list of respondents includes representatives from nearly 1,500 institutions around the world, of which more than 11% of companies have already been involved in cryptocurrency.
Cathie Wood, founder of ARK Fund, said that more companies are expected to include Bitcoin in their balance sheets.
From this, it can be predicted that institutions will increase their investment in Bitcoin and cryptocurrencies, and the resulting traffic and funds will maintain the continued upward trend of Bitcoin prices.
Favorable policies have also further deepened the upward signal of Bitcoin: on the one hand, the U.S. SEC Inspection Office has listed cryptocurrency as a priority for 2021, and more standardized supervision will promote a more healthy development of the cryptocurrency market; on the other hand, the U.S. Internal Revenue Service stated that purchasing cryptocurrency with fiat currency will not trigger tax reporting rules, which provides investors with a more reassuring investment and trading environment.
Crypto assets have been included in the U.S. SEC Inspection Office's priority list for 2021. The assessment of crypto asset market organizers will continue to evaluate the following: whether the investment is in the best interest of investors; the security of customer funds and assets; pricing and valuation; the effectiveness of compliance programs and controls; and the supervision of representatives' external business activities.
According to CoinDesk, the U.S. Internal Revenue Service (IRS) said on Tuesday that cryptocurrency investors who only "purchased virtual currency with real money" in fiscal year 2020 will not be required to report the transaction on this year's tax return. This clarification was published on the IRS's crypto FAQ page, effectively exempting taxpayers who purchased Bitcoin with US dollars from the responsibility of checking the cryptocurrency box on their annual 1040 account. However, the scope of the exemption is narrow. According to the latest IRS FAQ update, investors who exchange one cryptocurrency for another, sell their positions, or receive token airdrops still need to check the cryptocurrency box.
The relaxation of taxes and the standardization of regulations will create a more favorable development environment for Bitcoin, thereby expanding the interest of mainstream investors and increasing investment in cryptocurrencies, which is also an important favorable factor in consolidating the Bitcoin market.
Bitcoin's quest for a breakthrough rise is hindered. However, judging from the actual market reaction, although Bitcoin has stabilized at the $50,000 mark, it is still difficult to achieve a larger breakthrough rise.
Recently, there have been some new changes in the market. Investors have shifted from a single interest in Bitcoin to a broader range. The rise of Defi and NFT has diversified investors' interest in Bitcoin.
Recently, Grayscale has newly registered four trust fund products, including NMR, RSR, GRT, and FLOW, and is considering adding new digital assets such as AAVE, BAT, ADA, LINK, COMP, ATOM, MANA, EOS, FIL, LPT, MKR, DOT, STX, SUSHI, SNX, XTZ, UNI and YFI. This shows that more cryptocurrencies have entered the attention of investors, and market demand has expanded from mainstream currencies represented by Bitcoin to emerging assets such as cross-chain and Defi.
At the same time, since this year, in addition to Defi, NFT has also risen rapidly, which has also attracted widespread attention from the market.
Recently, information about NFT has frequently appeared in the media. The release and sale of art, music, NBA, etc. in the form of NFT has caused a sensation in the market, and its price and profit effects have become the focus of investors' attention.
For example, the "Homer Pepe" NFT artwork created based on the famous cartoon character "Homer the Frog" by artist Matt Furie was sold for 205 ETH (US$320,000), which caused a sensation in the market and made NFT strongly enter the investors' field of vision. According to Google data, NFT-related searches have now surpassed Litecoin (LTC), Bitcoin Cash (BCH), and Ripple (XRP), reaching a peak in late February.
According to DappRadar DApp’s report, the transaction volume of the top three NFT trading platforms reached US$342 million in February, an increase of nearly 400% from US$71 million in the previous month.
With the rapid rise of NFT, the market effect it brings has attracted investors' pursuit and has become an object of consideration for investors to expand their investment scope in cryptocurrencies.
Litecoin founder Charlie Lee tweeted: There are many similarities between NFTs in 2021 and ICOs in 2017 and altcoins in 2013. NFTs in 2021 have the following characteristics: barrier-free and easy creation of new games, easy to understand and explain, bringing a large number of new people into cryptocurrencies, high prices and high gas fees causing hype/FOMO, and most people do not own value.
The FOMO sentiment in the NFT market has already arisen, which will inevitably attract investors to join.
Therefore, Defi or NFT has actually distracted investors from mainstream assets such as Bitcoin and Ethereum. Funds and traffic have begun to shift from Bitcoin to these areas, thereby reducing Bitcoin's traffic attention and capital support.
Judging from the actual positive factors of Bitcoin mentioned above, although most of the recent favorable situations are friendly to Bitcoin, there are no concentrated major events to stimulate it, and it is difficult to trigger new FOMO sentiment in the market, thereby breaking through the new upward momentum of the market.
In the absence of major stimulus factors and capital dispersion, it is difficult for the market to achieve a breakthrough rise.
Therefore, it is highly likely that Bitcoin will remain around $50,000 and fluctuate sideways for a period of time until new major positive factors emerge. (Baijiahao) |
