Following its halving, Bitcoin has approached $67K, igniting a widespread cryptocurrency surge and fostering optimism in stocks of digital assets.
TakeAway Points:
- Following its halving, Bitcoin has increased in value to around $67,000. Notable market gains include a 15% spike in Near Protocol (NEAR) and notable increases in cryptocurrency equities like Coinbase (COIN) and MicroStrategy (MSTR).
- In spite of rising transaction fees, publicly traded miners Riot Platforms (RIOT), Hut 8 Mining Corp. (HUT), and Marathon Digital Holdings (MARA) saw significant profits.
- Due to negative funding rates, QCP Capital anticipates a possible short-term altcoin squeeze, indicating a bullish outlook for cryptocurrencies.
Bitcoin Closes to $67,000 after a Halving
On Monday, the cryptocurrency markets saw a sharp upswing, with Bitcoin (BTC) closing in on $67,000. This huge increase has allayed fears of a further slump. Following the weekend’s quadrennial halving event, which essentially cut the amount of fresh supply in half, there has been an increase in value of Bitcoin. In the last 24 hours, the price of Bitcoin has risen by more than 3% to $66,500, while the price of Ether (ETH) has increased by 1.5% over the same period to remain stable at $3,200.
Widespread Crypto Rally
The strong momentum extended throughout the whole cryptocurrency space, not just Bitcoin and Ether. A total of 163 out of 173 cryptocurrencies had positive daily returns, according to the CoinDesk Market Index (CMI). This increasing trend was also seen in the CoinDesk 20 Index (CDI), which increased by over 3%. The layer-1 blockchain Near Protocol’s native token (NEAR), which increased by 15%, led the way. This large increase highlights the strong speculative mood that characterised the cryptocurrency market after the halving.
The Rise in Crypto Stocks and Miners
The impact of the halving event went beyond cryptocurrencies to include stocks with an emphasis on digital assets. Significant rallies were seen in the shares of Coinbase (COIN) and MicroStrategy (MSTR), which increased 7% and 12%, respectively. There were increases of 6% to 20% in the value of publicly traded mining firms, including Riot Platforms (RIOT), Hut 8 (HUT), and Marathon Digital (MARA). This increase was linked to a spike in transaction fees, which are a significant source of income for miners and gave rise to hope for better financial results for these businesses.
Prospects for the Market and Miner Dynamics
Markus Thielen, the creator of 10x Research, issued a warning despite the market’s initial uproar, stating that the halving might not be a bullish development in the near future and alerting investors to possible weakness in the market and a more profound correction. This warning is due to the potential for miners to sell off their Bitcoin holdings in order to continue operating after a revenue reduction. Nonetheless, past trends following the halving point to a possible exponential price rise for Bitcoin, indicating that bulls might have a chance to expand their long positions in the upcoming weeks. Furthermore, should risk appetite rebound, the cooling off of funding rates for traders of leveraged futures and negative funding rates for certain cryptocurrencies point to a favourable climate for a quick market recovery.
“Bitcoin’s halving is not a bullish event and warned of market weakness for the next few months, with potentially a deeper correction in the cards.” Thielen said.
