After enduring a difficult first half characterized by a massive sell-off, the cryptocurrency market is seeing minor gains led by Bitcoin. The gains are evidenced by an increase in capital inflows to the market.
As of June 17, the total global cryptocurrency market capitalization was $906 billion, while on July 17 the figure stood at $977 billion, a growth of 7.83%, according to the data. from CoinMarketCap.
The gains came despite major cryptocurrency firms restructuring their operations, such as the option of bankruptcy protection due to the general market crash.
Crypto lending platform Celsius is among the prominent entities that have filed for bankruptcy after suspending customer withdrawals. Crypto hedge fund Three Arrows Capital and lender Voyager Digital have also filed for bankruptcy.
Although the market is rising in the short term, the current state is a shadow of last year’s gains, which saw Bitcoin hit an all-time high of nearly $68,000, with the overall crypto market cap rising to $68,000. over $3 trillion.
Bitcoin Holds Gains Above $20,000
Over the past 30 days, Bitcoin has also struggled to sustain gains above the crucial $20,000, at one point slipping below the level. During the period, the flagship cryptocurrency made minor gains of around 1.5%, trading at $21,400 at press time.
However, investors are watching for a possible extended rally as Bitcoin helps stabilize above $20,000. Notably, the $30,000 level remains a key psychological point. Based on current market conditions, it can potentially hit the $30,000 mark in September.
The gains in the cryptocurrency market can be seen as bullish sentiment given the current high inflationary environment. US inflation in June hit a record high of 9.1% and the crypto market reacted instantly, losing around $15 billion in minutes.
Indicators of a market bottom
The focus is on whether the market has bottomed out and is ready for another rally. Although analysts appear to be divided on where the market will move next, crypto consultant at multi-asset brokerage exchange eToro, Glen Goodman, believes recent negative headlines, particularly in mainstream media, point to a bottom.
Following the massive correction, some mainstream media platforms and analysts suggested that Bitcoin and the crypto market were dead, projecting a further correction.
The negative headlines were also fueled by steep losses suffered by investors, with several crypto-related firms suspending key operations.
Additionally, the sector has been hit by controversies like the Terra (LUNA) ecosystem crash which resulted in significant losses. Therefore, the incident appears to have shaken confidence in the market, especially with allegations citing network founder Do Kwon’s involvement in the losses.
Overall, the market continues to await the impact of any crypto regulations, with most jurisdictions citing the need to protect consumers while offering multiple regulatory frameworks.
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