Bitcoin has recently surged to $68,000 as of July 21, 2024, reflecting a 26% increase from its recent low of $53,905 recorded on July 5. The largest cryptocurrency by market cap has seen a 7% rise in the last seven days alone, driven by the buzz surrounding Donald Trump’s historic announcement at the Nashville Bitcoin 2024 Conference. According to the media reports, the former U.S. President is likely to announce the establishment of a U.S. Bitcoin strategic reserve.
As of the latest update, Bitcoin price today stood at $67,334.15, with a 24-hour trading volume of $29 billion and a market cap of $1.32 trillion, according to CoinMarketCap data. The sustained rally over the past two weeks has caught the attention of analysts and investors alike, prompting discussions about the driving forces behind this upward trajectory and what the future holds for Bitcoin.
Ryan Lee, Chief Analyst at Bitget Research, noted the overall positive momentum in the crypto market: “The crypto market has experienced a rebound for two consecutive weeks. The price of BTC has risen from $54,000 to the current level of $68,000. The market’s fear index has also increased from around 26 at the beginning of the month to the current level of 74.”
Key Drivers of the Surge
Two main events have significantly influenced Bitcoin’s rapid increase:
- Potential Approval of the ETH ETF: The market has been abuzz with the potential approval of the Ethereum ETF early this week. Analysts predict an inflow of $5 billion if the ETF gets the green light, which could further boost the overall crypto market sentiment and liquidity.
- Trump’s Support for Bitcoin: Former U.S. President and current Republican presidential candidate Donald Trump will attend the Bitcoin 2024 conference and is likely to announce the establishment of a U.S. Bitcoin strategic reserve. The possibility, however small, of Bitcoin becoming a “reserve asset” of the U.S. has led to speculation about a significant influx of institutional investments, potentially amounting to hundreds of billions of dollars.
Indicators to Monitor
As the market continues to evolve, investors should keep a close eye on the following indicators to gauge the sustainability of Bitcoin’s rally:
- Contract Fee Rates: High contract fee rates could indicate potential market reversals. If the funding rate for long positions on mainstream assets exceeds 60%, it may be a sign of an overheated market.
- Options Skew: The disparity between the prices of BTC call and put options serves as a valuable sentiment indicator. If call options become significantly more expensive than put options, it usually signals excessive market fear of missing out (FOMO), which could precede a correction.
Sector Opportunities
In the wake of Bitcoin’s resurgence, certain sectors within the cryptocurrency market are presenting new opportunities:
- Solana Meme Coins: Solana’s native token, SOL, has experienced a robust rebound, climbing from $120 to $180—a nearly 50% increase over two weeks. The rise of Solana Meme coins, particularly in the context of the U.S. election, indicates potential volatility and trading opportunities as political developments unfold.
- Proof of Work (POW) Sector: Trump’s engagement with the Bitcoin community and his presence at the forthcoming Bitcoin 2024 conference are seen as a strategic move to garner support from American miners. This political backing, combined with potential favorable policies, is likely to benefit mining operations, supporting the price trends of related assets.
Overall, the potential approval of the ETH ETF and Trump likely to announce the establishment of a U.S. Bitcoin strategic reserve during the Bitcoin 2024 conference in Nashville have provided significant momentum to overall crypto market. Monitoring key indicators and sector developments will be crucial in navigating the next phase of Bitcoin’s journey. Whether Bitcoin will break new all-time highs in August remains to be seen, but the current optimism is palpable across the crypto community.
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