Bitcoin has been slowly declining and is trading around $44K on the penultimate day of the week. Technical analysis showed us that the first cryptocurrency’s inability to confidently overcome $48K would result in a correction. Nevertheless, the correction remains moderate at this stage.
Apparently, large institutional investors are focused on the traditional market. The publication of the FOMC minutes triggered a liquidation of risky assets but so far only marginally affected the crypto market. The benchmark S&P 500 stock index is declining, which could be followed by the crypto market.
Trading volumes on the Bitcoin network remain depressed, suggesting a wait-and-see attitude remains in place. In theory, the current uncertainty in digital assets and low trading volumes are a great opportunity for a small market to profit very quickly from increased market volatility.
Bitcoin is the undisputed leader of the crypto market at the current stage, but there is an opinion that it may concede its role to Ethereum. Nigel Green, CEO of deVere Group, believes that the price of ETH could overtake BTC in a few years.
Already, many crypto exchanges are claiming that Ethereum is ahead of Bitcoin in terms of trading volumes. Indeed, the project boasts of delivering on its promises, and although the deadlines are regularly postponed, this is perceived positively in the community, pointing to a desire to minimize bugs. Ethereum has more substantial real-world potential, and it is also the basis for a huge number of projects, including DeFi and Stablecoin.
The Dogecoin Foundation, whose leadership includes Vitaly Buterin and Neuralink CEO Jared Birchall (= Elon Musk), may be an interesting news factor. Apparently, having “probed” the prospects of the price dynamics of this cryptocurrency joke, it was decided to continue development.
As always, it is a matter of a combination of factors that attracted famous names to the project, and now the demand for the coin may reach a whole new level. It is very likely that the motto “DOGE = $1” may well become a reality.
The end of the summer lull could intensify the fluctuations of the crypto market. As the borders begin to open and as a relatively successful vaccination campaign is underway, many investors have gone on vacation. From the looks of it, their return will be immediately noticeable by the increase in trading volumes. It is likely that as big capital returns to work, we could be in for hot autumn and an equally hot winter.
The FxPro Analyst Team
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