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Bitcoin spikes 5% as cryptos continue to surprise investors. What lies ahead?


Staying true to its character of extremely volatile asset, bitcoin jumped 5.27 percent in the past 24 hours on Thursday to trade at $67,170 in the international crypto markets, CoinDesk data shows.

Bitcoin saw a decline of upto 10 percent early this week on profit-booking before the sentiment reversed following US Fed Reserve head Jerome Powell’s dovish speech. After this, crypto tokens started rising again.

While the much sought-after crypto token spiked over 5 percent, Ethereum rose 6 percent to trade at 3,555, Binance Coin jumped 5.6 percent to $562 and solana spiked nearly 10 percent to $190, shows Coindesk data.

Additionally, dogecoin surprised the crypto market by rising up to 18 percent.

Date                          BTC ($)
Mar 13:                   73,083
Mar 14:                      71,396
Mar 19:                   61,912
Mar 21:                   67,261

(Source: Coinmarketcap)

One can check the table above to get a sense of the wide volatility reflected by bitcoins in the past few days. While the bitcoin price hit as high as $73K on March 13, it declined to $61K on March 19.

Again, it spiked to $67,000 today, while it stays 8 percent lower than the all-time high of $73,127.

“The volatility in cryptocurrency prices often underscores the manipulative nature of the crypto economy. Despite claims of trillions of dollars in fully diluted market cap, calculated by multiplying price by max supply, the actual liquidity available on exchanges is far more limited. This susceptibility to manipulation becomes evident when considering the relatively small amount of liquidity, often just a few hundred million dollars,” explains Gaurav Mehta, Co-founder and CEO of Catax- Simple Crypto Taxes.

Notably, Bitcoin hit $73,000 on March 13 to become the eighth largest asset worldwide by market capitalisation. The momentum of price jump was built after the US markets regulator Securities and Exchange Commission (Sebi’s counterpart in America) cleared spot bitcoin ETFs early this year.

However, experts are quite hopeful of bitcoin’s price movement in the near future. Meanwhile, Standard Chartered has revised bitcoin’s year-end prediction, thus raising it from $100,000 to $150,000.

The next price trigger is seen to be the bitcoin-halving event while there are numerous other factors which will play their role in influencing its price in the near future.

What experts say

Most crypto experts assert that bitcoin’s price fluctuation is a reflection of market volatility. They also suggest that investors should remain confident in crypto assets, and view the price fluctuation from a long term’s perspective.

“Within a short span, Bitcoin experienced a remarkable 20 percent surge to reach $73,000, followed by a subsequent 10 percent drop, only to retrace by 10 percent before surging back up to $67,000. This fluctuation can be attributed to profit booking by investors. Despite these rapid changes, investor confidence in the asset class remains robust. It’s important to recognize that such volatility does not necessarily indicate a new norm. For investors, it is always advisable to adopt a long-term approach with a diversified portfolio,” says Minal Thukral, executive vice president, Growth and Strategy, CoinDCX.

Parth Chaturvedi, Investments Lead, CoinSwitch Ventures, says, “When markets run up like they have in the last two months, there are always expectations of price correction. A couple of big factors contributed to the sell-off, the first being US inflation data exceeding expectations. The second: Grayscale’s GBTC ETF saw heavy outflows for two days. The reversal, however, was short-lived and BTC prices are again on the rise, as the Fed confirmed that there will still be 3 rate cuts this year.”

ALSO READ: Over $1 billion liquidated from cryptocurrency market over the past 24 hours

“The market is likely to continue experiencing heightened volatility till the Halving event in April and investors should be very careful when taking leveraged positions,” he added.

Rajagopal Menon, VP, WazirX says that the long-term trajectory is bullish. “Long-term, the trajectory is bullish based on historical cycles, particularly focusing on the impact of Bitcoin halving event that have traditionally signalled the start of significant bull runs. The expectation is for a continued bull market into 2025, with interim corrections seen as opportunities for accumulation,” he says.

Bidding Adieu

Meanwhile, Indian crypto exchange OKX announced to end its services. The exchange said that customers are supposed to close their positions by the end of April after which they won’t be permitted to withdraw their funds.

In order to operate in India, a crypto exchange must be registered with the Financial Intelligence Unit (FIU Ind) India. So far, 28 firms have done this so far and OKX was not one of them.

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