Bitcoin
BTC$23 396.59

-0.27%

Ethereum
ETH$1 657.83

1.20%

Tether
USDT$1.000118

0%

Binance Coin
BNB$330.60

3.36%

USD Coin
USDC$1.000017

0%

XRP
XRP$0.409253

0.39%

Bitcoin Spring: Will BTC bounce back soon?


19 Jan 2023

#Bitcoin

Bitcoin (BTC) showed signs of life last week, hitting $19,003 (USD) settling in the $18,800–$18,900 range. The 7-day $2000 increase has traders wondering if Bitcoin is back. What’s causing the recent lift, and will it stick? The crypto market got a boost on Thursday, possibly because of the US government’s latest Consumer Price Index (CPI). Many crypto traders and traditional economists took the Fed report as a sign that the Federal Reserve is ready to declare victory against inflation, and the positive sentiment awoke the sleeping crypto-giant, Bitcoin.

BTC traders saw the biggest 1-day increase in months, the first bearish signs since the crypto exchange FTX crumbled. Some analysts claim the $19K level will lead to $21K, although the Fed pivot and the Bitcoin rise may be a coincidence since nobody can fully explain the mechanics behind the speculated influence. It’s perhaps a little early to get optimistic about any digital currencies, but that it is rising suggests the crypto-space has potential soon—but not yet.

More bad crypto sentiment

Last Thursday, the US Securities & Exchange Commission claimed in a lawsuit that several crypto exchanges and lenders are selling unregistered securities, which is causing contrasting speculation over the future of digital currencies. Institutional investors are still hesitant to board the crypto train for many reasons, but volatility and security are two of the primary concerns. Volatility may always be a part of Bitcoin trading, but that can be both a blessing and a curse depending on your trading style.

As for security, the vast majority of people still don’t understand the difference between blockchain technology, and often assume that it is susceptible to hacks. So is blockchain safe?

Crossing crypto bridges

Blockchain-based technology is diverse, stable, and is almost certainly the future of financial transactions, but there’s no standardization and not all coins are compatible with each other. Cross-coin crypto connections are made through networks or bridges, moving liquidity throughout the crypto space. Crypto traders can transfer coins/tokens and other digital assets between various blockchains using this bridging technology. 

The bridges act as, well, a bridge, by creating synthetic derivatives for every coin. Therein lies the problem. While blockchain technology is bulletproof, the bridges are vulnerable to cyber attacks, which is what’s been happening to several exchanges over the last few years. Bridges need to maintain a large coin reserve to underwrite the coins being transferred, and those are the funds that hackers are targeting.

Bridges will always be the prime target for hackers, and despite continuous security monitoring, most of them remain vulnerable. Bridge hacks are one of the last hurdles to stamp out before institutional investing can restart.

Conclusion

Blockchain is solid, exchanges are vulnerable, crypto-sentiment remains low, and institutional investors are not ready to dive into the crypto space. There are no signs that Bitcoin will resurrect in Q1. Compared to gold (XAU), BTC is still flatlining. Of course, many retail investors may be holding off on non-essential spending because of recessionary fears, and, as spare cash runs dry, more and more traders will start dipping into their crypto portfolio. If you’re thinking of buying BTC at the current low, be aware that many analysts believe Bitcoin will drop below 15K this quarter.

Institutional investors who capitalized well in 2021 are staying out of the crypto space for now, but they’ll be back as soon as media reports and sentiment give them a reason. And when institutional investors come, crypto rockets. For now, BTC still offers excitement for day traders. According to investment management firm Man Group Ltd, a Buy & Hold strategy for Bitcoin is not recommended. Trend trading being the most successful strategy for trading BTC and other coins.

Nobody can say whether we've seen the last of downward movement. Nor can anyone say we are seeing a bullish trend forming. Data and various indicators used to see where Bitcoin is in its cycle suggest that BTC is close to bottom, but even when the indicators say that bottom is reached, there’s often a last-minute lurch, so watch out for that. Stay calm, be ready, and consider trading BTC in 2023 instead of investing long-term.


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Top Cryptocurrencies with Price Predictions

# Crypto Prediction Accuracy CVIX Price 24h 7d Market Cap 7d price change
1 Bitcoin (BTC) BTC Bitcoin predictions 62.8% 76 $23 396.59 -0.27% 1.23% $451 107 099 851 BTC 7 days price change
2 Ethereum (ETH) ETH Ethereum predictions 68.4% 64 $1 657.83 1.20% 3.76% $202 875 422 612 ETH 7 days price change
3 Tether (USDT) USDT Tether predictions 92% 1 $1.000118 0% -0.01% $68 036 636 818 USDT 7 days price change
4 Binance Coin (BNB) BNB Binance Coin predictions 76.8% 39 $330.60 3.36% 7.50% $52 201 447 647 BNB 7 days price change
5 USD Coin (USDC) USDC USD Coin predictions 96% 1 $1.000017 0% 0.01% $41 963 522 546 USDC 7 days price change
6 XRP (XRP) XRP XRP predictions 75.6% 51 $0.409253 0.39% -0.52% $20 789 661 448 XRP 7 days price change
7 Binance USD (BUSD) BUSD Binance USD predictions 94.8% 1 $1.000189 0.04% 0.02% $16 275 345 911 BUSD 7 days price change
8 Cardano (ADA) ADA Cardano predictions 66.8% 69 $0.401320 0.57% 2.97% $13 885 724 489 ADA 7 days price change
9 Dogecoin (DOGE) DOGE Dogecoin predictions 73.2% 48 $0.093563 3.08% 6.89% $12 413 030 793 DOGE 7 days price change
10 Polygon (MATIC) MATIC Polygon predictions 66.8% 64 $1.23 4.16% 7.23% $10 735 757 319 MATIC 7 days price change
11 Lido stETH (STETH) STETH Lido stETH predictions 93.2% 1 $2 941.39 -0.40% -3.32% $10 258 752 564 STETH 7 days price change
12 Solana (SOL) SOL Solana predictions 59.2% 88 $24.53 1.61% 0.31% $9 140 950 218 SOL 7 days price change
13 Polkadot (DOT) DOT Polkadot predictions 65.2% 74 $6.90 5.36% 4.77% $7 960 238 223 DOT 7 days price change
14 SHIBA INU (SHIB) SHIB SHIBA INU predictions 63.2% 79 $0.000014 17.92% 21.32% $7 857 412 436 SHIB 7 days price change
15 Litecoin (LTC) LTC Litecoin predictions 76.8% 38 $99.43 0.66% 12.27% $7 179 111 477 LTC 7 days price change

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