Bitcoin posted strong gains on Wednesday, reaching its highest level in two weeks as the digital asset market sought to recover some of the significant losses incurred in recent weeks. This rise came as the market attempted to regain its footing after a sharp sell-off.
The world's largest cryptocurrency rose by nearly 7 percent, trading near $93,000, its highest intraday level since November 17. Ethereum and other major digital currencies also saw strong gains.
Despite this rise, the market remains volatile, influenced by the uncertainty that has gripped it since the beginning of the downward trend in early October, which followed Bitcoin's record high of over $126,000. During that period, more than $1 trillion was wiped off the total value of the cryptocurrency market.
Fragile feelings and erratic movements
Sean McNulty, head of derivatives trading for Asia Pacific at FalconX, explained that the market still lacks buyers at higher price levels, stressing that overall sentiment remains weak and sensitive to any movement.
The performance of Bitcoin-linked exchange-traded funds (ETFs) in the United States is seen as a key indicator of investor confidence, but these funds recorded limited inflows of $59 million on Tuesday, according to Bloomberg data, reflecting continued caution.
The week began with extreme volatility, after prices fell on Monday following comments from Strategy& CEO Fong Lei, who indicated that the company, which continues to buy Bitcoin, may have to sell part of its holdings to pay off debts if necessary.
The actions of major companies restore balance
The company – formerly known as MicroStrategy – announced its intention to establish a $1.4 billion reserve to provide readily available liquidity to deal with any potential financial obligations, which eased concerns in the market.
Bitcoin recovered some of its losses on Tuesday as investors turned their attention to U.S. Securities and Exchange Commission Chairman Paul Atkins, who is set to unveil details of innovation exemptions for digital asset companies. The market also received a boost after Vanguard agreed to allow cryptocurrency exchange-traded funds (ETFs) and mutual funds to trade on its platform.
Coinglass data indicated that the recent surge led to the liquidation of approximately $400 million in short positions across a range of cryptocurrencies in the past 24 hours, which contributed to the current rebound.
Temporary setback and new opportunities
Melvin Deng, CEO of QCB Group, said in an interview with Bloomberg Television that the recent surge is nothing more than a temporary relief, adding that Bitcoin may nevertheless succeed in regaining some of the lost momentum at these price levels.
He added that this level is suitable for investors who have not yet entered the market sufficiently, explaining that the current stage may provide an opportunity to reassess investment positions in light of the continued volatility and lack of clarity regarding the general direction.
Fragile feelings and erratic movements
Sean McNulty, head of derivatives trading for Asia Pacific at FalconX, explained that the market still lacks buyers at higher price levels, stressing that overall sentiment remains weak and sensitive to any movement.
The performance of Bitcoin-linked exchange-traded funds (ETFs) in the United States is seen as a key indicator of investor confidence, but these funds recorded limited inflows of $59 million on Tuesday, according to Bloomberg data, reflecting continued caution.
The week began with extreme volatility, after prices fell on Monday following comments from Strategy& CEO Fong Lei, who indicated that the company, which continues to buy Bitcoin, may have to sell part of its holdings to pay off debts if necessary.
The actions of major companies restore balance
The company – formerly known as MicroStrategy – announced its intention to establish a $1.4 billion reserve to provide readily available liquidity to deal with any potential financial obligations, which eased concerns in the market.
Bitcoin recovered some of its losses on Tuesday as investors turned their attention to U.S. Securities and Exchange Commission Chairman Paul Atkins, who is set to unveil details of innovation exemptions for digital asset companies. The market also received a boost after Vanguard agreed to allow cryptocurrency exchange-traded funds (ETFs) and mutual funds to trade on its platform.
Coinglass data indicated that the recent surge led to the liquidation of approximately $400 million in short positions across a range of cryptocurrencies in the past 24 hours, which contributed to the current rebound.
Temporary setback and new opportunities
Melvin Deng, CEO of QCB Group, said in an interview with Bloomberg Television that the recent surge is nothing more than a temporary relief, adding that Bitcoin may nevertheless succeed in regaining some of the lost momentum at these price levels.
He added that this level is suitable for investors who have not yet entered the market sufficiently, explaining that the current stage may provide an opportunity to reassess investment positions in light of the continued volatility and lack of clarity regarding the general direction.
