As the stock markets recovered from this week’s plunge, bitcoin’s price rallied and now the world’s most valuable cryptocurrency could face resistance at $ 50,000 – $ 55,000.
Bitcoin surpassed $ 49,000 this week for the first time since May, ending the week on a very strong note.
At the time of this writing, the BTC rate was $ 49,208, which reflects an increase of 1.48% over the previous 24 hours and 4.99% over the past week, with a market dominance of 44%.
This may be partly due to Coinbase’s announcement that the company will add over $ 500 million in crypto to its portfolio.
Brian Armstrong, CEO of one of the most famous cryptocurrency exchanges, said that «we will invest 10% of all future profits in cryptocurrency.» The top manager added that this percentage will grow as the crypto economy develops.
Be that as it may, the current valuation of the global cryptocurrency market is $ 2.10 trillion, which is 3.53% more than the previous day. In addition, the total trading volume of the cryptocurrency market over the previous 24 hours was $ 111.90 billion, down 0.69%.
DeFi’s total volume is currently $ 14.29 billion, which is 12.77% of the total 24-hour cryptocurrency market volume.
Crypto analyst Mikael van de Poppe believes that «a total market cap of $ 2.2 trillion will be the next resistance.»
A more likely reason for the rise in the BTC rate should be considered the fall on Friday of shares of the Chinese technology sector to a new minimum. The Hong Kong benchmark index fell to nearly a 10-month low as pressure from Chinese regulators eroded investor confidence.
Markets in Hong Kong and mainland China have lost more than $ 560 billion in market value over the week as funds are withdrawn from once-preferred equities, fearing authorities will target new industries.
$ 90 billion of these funds went to the crypto market, mainly in bitcoin.
The Hang Seng Index (.HSI) fell 1.8%, with a weekly decline of 5.8%, the worst since March 2020, when financial markets were in a pandemic panic, Reuters reported.
Shanghai shares also fell as investors dumped riskier corporate debt and the Chinese yuan. As a result, the currency was approaching its worst weekly drop in two months.
International investors are fleeing the tech sector en masse, fearing that they will not be able to quantify regulatory risk. For example, since its New York IPO in 2014, Alibaba (NYSE: BABA) has the lowest price-to-earnings ratio.
In contrast, shares in US-registered Chinese EVs (EVs) such as NIO, Xpeng and Li auto have gained traction as speculators took advantage of the recent sell-off triggered by tight regulation from Beijing.