For the first time in a month, the Bitcoin rate reached a value of over 44,000 US dollars. In the last 24 hours alone, the crypto currency has increased by almost three percent. Looking at the last week, it’s almost 13 percent. Investors still seem to be cautious, but the price is recovering.
Bitcoin course is recovering
Bitcoin continues to rally after falling below $33,000 for the first time since mid-2021 on Jan. 24. In November 2021, the cryptocurrency first hit its all-time high of over $69,000 and then fell due to a variety of different factors.
Just last month, the crypto exchanges experienced various outflows. Such are usually associated with active purchases. For example, in May 2021, after Bitcoin fell by a good third in 24 hours, the largest cryptocurrency withdrawal in a year was recorded. At that time, users transferred around 175,000 Bitcoin worth a good seven billion US dollars to cold wallets.
A cold wallet is storage for cryptocurrencies that is not connected to the internet. You can find out here why you need a wallet for cryptos.
reasons for the increase
When it comes to a volatile market like that of cryptocurrencies, experts rarely agree. Market strategist Matt Maley, for example, believes that the quarterly figures of the large tech companies are primarily responsible for the current recovery in the Bitcoin price. The reports from Amazon, Apple, Google and Microsoft in particular “gave investors more confidence”, quoted Wirtschaftswoche.
The financial market analyst Timo Emden, on the other hand, sees “the growing interest of institutional addresses” as a reason for “hope among investors”. This new willingness to take risks could have a price-stabilizing effect.
However, Emden also ascribes a similarly important role to technical reasons. As a result of the crash, speculative investors would have bet on another fall in the Bitcoin price. If this recovers, however, according to Wirtschaftswoche, they would have to close out their position and buy back the assets. “Such a short squeeze acts as additional support for the current rally in the market,” concludes Emden.
Source: Wirtschaftswoche; own research