Analysts point to overheating in derivatives markets as a contributing factor to the pullback.
The cryptocurrency market has been on the rise in recent weeks, with Bitcoin (BTC) surpassing the crucial $30,000 level. Although the BTC price has retreated slightly in the last day, traders are now speculating whether the coin could reach $40,000 eventually. of the year. Meanwhile, crypto mining startup Bitcoin Minetrix (BTCMTX) continues to surprise investors during its limited-time pre-sale phase, raising more than $3.1 million in seed funding.
Bitcoin Pulls Back After Meeting $35,000 Resistance
Over the past 12 hours, Bitcoin has retreated from its recent high above $35,000, giving up some gains after the latest FOMC meeting. BTC is now trading around the $34,850 level, representing a 3% drop from yesterday’s peak.
Analysts point to overheating in derivatives markets as a contributing factor to the pullback. The data showed that Bitcoin derivatives such as futures and options are at elevated levels, indicating a large amount of leverage and speculation.
With the derivatives market overextended, the pullback reflects “de-risking” by traders, possibly aligning the price with less leveraged positions. The move lower could also be a much-needed respite from the Federal Reserve’s latest interest rate announcement.
Federal Reserve Chairman Jerome Powell noted that the central bank is considering slowing the pace of rate hikes, which is good news for risk assets like cryptocurrencies. However, Powell reiterated that the Federal Reserve is still heavily focused on reducing inflation, meaning political uncertainty will likely persist into 2024.
Can Bitcoin Regain Momentum and Reach $40,000 This Year?
Amid the BTC pullback, the big question is whether Bitcoin can regain momentum and approach $40,000 before the end of the year. The latest comments from the Federal Reserve hint at a possible end to rate hikes, which would return liquidity to the cryptocurrency market.
However, geopolitical tensions and macroeconomic conditions continue to create tension in the market, which could affect investors’ buying and selling decisions. Bitcoin’s historical price patterns before the halving events could also provide catalysts to help BTC reach $40,000.
BTC tends to follow four-year cycles aligned with halving events, and prices often rise months in advance. The next halving is scheduled for April 2024, leading some to predict that Bitcoin’s value could skyrocket between now and then.
Finally, accumulation trends also point to growing confidence in Bitcoin. Major investors are exchanging their stablecoins for BTC, suggesting that demand is increasing among high-net-worth individuals. If these accumulation patterns persist, along with the historical impact of halvings and improving macroeconomic conditions, then Bitcoin could be poised for a rally to $40,000 by the end of 2023.
New Minetrix Bitcoin Project Draws Pre-Sale Attention, Passes $3.1 Million Milestone
Bitcoin Minetrix (BTCMTX) is an interesting new platform that is causing a stir in the market due to its unique “Stake-to-Mine” model. The model allows users to earn BTC rewards by simply staking BTCMTX, the native Bitcoin Minetrix token.
The project’s pre-sale has seen enormous momentum, raising over $3.1 million from investors. Investors can purchase BTCMTX tokens through this pre-sale for only $0.0114 in the future. of its open market debut, which is scheduled to occur once the pre-sale ends.
Additionally, prominent crypto influencers like Michael Wrubel have supported BTCMTX, believing it could be primed for a surge at the end of the year. Whether Bitcoin Minetrix will be able to live up to its expectations is anyone’s guess.
By Audy Castaneda