Bitcoin Trading Sideways as Fidelity Refiles Bitcoin ETF Application and Strong US Economic Data Emerges
When the Asian markets opened on Friday, Bitcoin showed a lacklustre performance, with little reaction to news of Fidelity Investments resubmitting their application for a Bitcoin exchange-traded fund (ETF), as well as unexpectedly strong U.S. economic data. My friends, the cryptocurrency was trading at around $30,400, representing a 0.6% increase in the previous 24 hours.
Fidelity has joined the ranks of recognised financial powerhouses such as Blackstone, Invesco, and WisdomTree in its pursuit of financial greatness. These formidable businesses have recently submitted applications to the prestigious US Securities and Exchange Commission (SEC) for spot BTC ETFs. These outstanding measures have undeniably boosted investor confidence and played a critical role in boosting crypto prices to new heights.
Despite regulatory uncertainties in the United States and tragic failures such as the recent FTX debacle, it is truly wonderful to see the digital asset business demonstrating resilience and bouncing back from the assault of negative news. Global competition in the nascent business is heating up, with institutional demand rising, as evidenced by BlackRock's recent development of a Bitcoin ETF.
Ether, the astonishing cryptocurrency runner-up, is currently trading at a healthy $1,844, demonstrating great durability since midweek. Other big cryptocurrencies were mainly in the green, but Solana's token (SOL) had a significant increase, a real surge, mind you, of more than 14%. It's incredible, truly incredible.
Crypto traders on the Solana blockchain have been closely monitoring the prevalent phenomenon of Ethereum's heated "Liquid staking token" (LST) craze. They are using their SOL token derivatives carefully to achieve profitable returns using a complex re-leveraging mechanism. This trend, my friends, has emerged as a result of Drift Protocol's introduction of a great service. They call it "Super staking," a game-changing innovation that reduces the entire process to a single button click.
The CoinDesk Market Index, a fantastic indicator of the cryptocurrency market's success, recently showed a nice 1.2% increase.
The existence of favourable economic statistics, such as a revised 2% increase in GDP and a decrease in weekly unemployment claims, failed to have a significant impact on trading activities in the United States equities markets. These results suggest that inflation may remain a problem, potentially strengthening the Federal Reserve's desire to raise interest rates twice more in 2023. The excessive monetary hawkishness seen in the past year has undoubtedly produced major instability in asset markets.
At the prestigious Banco de Espana Fourth Conference on Financial Stability, the outstanding Fed Chair, Jerome Powell, expressed uncertainty about the sensible ways to address the imminent inflationary problems that lay ahead in the coming months. However, let me tell you that he has made it quite apparent in recent weeks that the Federal Reserve intends to raise interest rates in the very near future. Powell, my dear friend, has finally accepted that inflationary pressures are continuously high. He has also conceded that the full effects of monetary constraint would take a long time to manifest.
According to Akash Mahendra, a distinguished director at Haven1 Foundation and an accomplished portfolio manager at the acclaimed digital wealth platform Yield App, the "bitcoin ETF frenzy" certainly speaks positively for Bitcoin's price trajectory. However, it is critical to acknowledge that the success of this industry will be dependent on the unwavering pursuit of innovation. Blockchain, my friends, offers a variety of chances for innovation that much outnumber what is currently available in traditional banking.
When it comes to cryptocurrency performance, Solana (SOL) emerged as the top gainer, with a 14.8% increase. Gala (GALA) earned the second spot in the entertainment sector with a decent 3.9% growth, while Avalanche (AVAX) in the smart contract platform sector managed a commendable 2.9% increase. Cosmos (ATOM), on the other hand, had a 2.2% decline in the smart contract platform industry.
Despite Bitcoin's notorious reputation for inherent volatility, a specific indicator demonstrates a sense of unchanging confidence among Bitcoin investors in maintaining their position in this digital asset. Even during the difficult bear market that saw the price collapse from a lofty $70,000 peak in 2021 to a paltry $16,000 at the dawn of 2023, the amount of Bitcoin's circulating supply that has remained dormant since 2021 has risen to a staggering 55%. This suggests that investors are amassing and retaining Bitcoin holdings, indicating their unshakeable conviction in the commodity.
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