Bitcoin's third acceleration and Solana's fifth place

Bitcoin's third acceleration and Solana's fifth place

Market picture

Crypto market capitalisation duplicated its December peak on Wednesday evening, reaching $1.65 trillion, before marking a neat profit-taking following a similar move in stock indices. The propensity for profit-taking after a surprisingly strong rise in 2023 alternated with FOMO momentum. These factors are arguably the only market drivers right now without significant economic and market news.

Bitcoin is adding about 1.9% to $43.7K. This is the third acceleration since the end of October: first, there was strong momentum and buying within an upward corridor. In December, the upper boundary of this corridor became support, and market volatility generally increased. This week, buying on downturns became even more active.

However, some altcoins are noticeably lagging. For example, Ethereum and Litecoin have been under the crush of investors since 9 December. It is more correct to speak about them about the downward trend now. XRP - was in a deep sidewall with decreasing volatility. On Wednesday, Solana gained fifth position in the ranking of the largest cryptocurrencies by market capitalisation. For traders, this was a new reason to pump, which exceeded $85 on Thursday (+13% over 24 hours).

News background

In 2024, Messari predicts that the crypto market will enter a bullish phase, and Bitcoin will become its driver, surpassing the growth of most other assets. In the long term, the world is moving towards a digital age in which BTC will become the digital analogue of gold. Assumed parity with the precious metal gives the first cryptocurrency a quote of over $600,000.

Approval of a spot bitcoin-ETF is likely to happen by 10 January 2024, K33 suggests. The recent wave of updated applications for similar funds evidence this.

MicroStrategy founder Michael Saylor believes that the approval of spot bitcoin-ETFs in the U.S., which the entire crypto industry has been waiting for, will be the biggest event for the U.S. stock market in the last 30 years. He said the market has never experienced a two to ten-fold increase in demand combined with a shortage of supply of a sought-after asset that people want to own for a long period of time.

The over-optimism of crypto investors, driven by the impending approval of spot bitcoin ETFs, has moved BTC to overbought levels seen in 2021. JPMorgan notes and warns of a high probability of a "buy rumours, sell facts" effect when the SEC approves ETFs early next year.

Coinbase crypto exchange CEO Brian Armstrong criticised US Senators Elizabeth Warren and Roger Marshall for trying to turn big banks against the crypto industry. According to him, "being against cryptocurrencies is a truly bad political strategy for 2024." Coinbase shares are up more than 400% in 2023, outperforming all leading cryptocurrencies.

By the FxPro Analyst Team