Bitcoin price (BTC) movement surprised investors and analysts amid the rally of 15% in Wednesday trading, making it the largest gain in a single day since July 2018. Bitcoin price soar above $4200 and its market cap crossed $70 billion after collapsing around $65 billion last week for the first time in the past fourteen months.
The flagship cryptocurrency tumbled sharply during the Thanksgiving week; the largest coin dropped to this year low of $3500 mark on Sunday. Despite the latest price hike, bitcoin price is still deeply in the red considering its performance since the start of this year.
Why Bitcoin Price Rose Overnight?
The sudden and sharp growth in bitcoin price is quite surprising; retail investors feared that the crypto market would crash anytime after the deep market selloff in the past two weeks. The cryptocurrency market, however, bounced back strongly in Wednesday trading.
The rebound in bitcoin price is supported by traders sentiments that the largest coin had hit bottom during the last week; traders strategy to capitalize on the huge drop in price also supported upside movement.
Bitcoin (BTC) Price Today – BTC / USD
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“Today’s rise is mostly a reaction to the precipitous drops last week and people thinking that may have been an overreaction. Because crypto markets are still relatively small, one buyer placing an especially large “buy” order can “kick off an avalanche,” Andy Bromberg, co-founder, and president of CoinList said.
Brian Kelly, on the other hand, believes that the end of the hash war between bitcoin cash lovers sparked the rally in cryptocurrency markets. Bitcoin Cash split into two versions on 15th November— “Bitcoin ABC” and “Bitcoin SV”.
“You’re seeing the bitcoin cash saga play itself out. People were funding a lot of that by selling bitcoin, so one element of sellers have left the market. People are starting to understand that this is a legitimate asset class,” Kelly said.
SEC and NYSE Played a Key Role in Strengthening Sentiments
SEC chairman outlined few factors that the crypto market needs to fix to get bitcoin ETF’s approval. These factors include security and fair trading environment. He said, “What investors expect is that trading in the commodity that underlies that ETF makes sense and is free from the risk of manipulation. It’s an issue that needs to be addressed before I would be comfortable.”
Investors believe that the recent developments in cryptocurrency markets are likely to enhance SEC confidence in crypto markets. These developments include the custodian services from Goldman Sachs and fidelity along with prospects for the integration of NYSE surveillance technology to reduce the possibility of hacks and thefts.
The comments from NYSE chairman also helped in restoring trader’s confidence; the chairman said they are looking to launch bitcoin future contracts next month despite the slump in prices. The chairman also commented that crypto coins are not going anywhere as an asset class. Overall, trader’s strategy to capitalize on lower prices along with positive comments from SEC and NYSE added to sentiments and crypto market fundamentals.
