Bitcoin rose 5% on Wednesday to just over $ 50,000, and traders are wondering if the move represents a recovery from this year’s powerful bull market or simply a rebound from last week’s sharp drop to around 43,000. dollars.
The largest cryptocurrency is now up 10% so far in March, and a gain this month would mark the sixth consecutive monthly increase, the first time this has happened in seven years.
At 9:00 p.m. UTC (4:00 p.m. ET), bitcoin was changing hands just above $ 51,000 on Coinbase. The largest cryptocurrency is still a far cry from its all-time high of over $ 58,000 reached at the end of last month.
“One week is a long time in crypto: a print of $ 43,000 and the retracement seen last week might as well have been 6 months ago,” wrote Matt Blom, head of sales and trading for digital asset exchange firm EQUOS, Wednesday. “If the market can hold above the support at $ 47,850, then a continued push at higher prices is the likely outcome.”
Market Analyst Joseph Young tweeted the latest $ 50,000 breach came with signs the market is rejuvenating, with derivative funding costs returning to normal from high levels last week, some signs of overcrowding in the futures market and data on the blockchain showing that institutional investors are preparing to hold on for the long term.
In other words, the market now appears to have completely reset after the slowdown last week, which could make another rally more durable.
Ether (ETH), the second largest cryptocurrency by market cap, rose along with Bitcoin on Wednesday. It hit around $ 1,650, climbing 7% in 24 hours at 9:00 p.m. UTC (4:00 p.m. ET).
A potentially worrying sign: Despite the asset’s strong performance to start the month, shareholders in Grayscale’s Ether Confidence don’t seem so bullish. The difference between the price of ether, as implied in grayscale vehicle prices, and cryptocurrency spot prices turned negative on Tuesday after briefly flipping into positive earlier this week.
According to Skew’s data, the Grayscale Ether Trust had a -4.62% premium, perhaps a sign that investors are capitalizing on their stocks even as buyers of ether accumulate through the spot markets or other investment vehicles. (Grayscale is a unit of Digital Currency Group, which owns CoinDesk.)
Another explanation could be that the negative premium represents increased competition among providers of publicly traded ethereal products. An application was recently filed in Canada for what would be North America’s second-largest ether ETF, CoinDesk reported on Tuesday.
Along with the ether, decentralized financial assets were in the green on Wednesday. The sector gained 9.5% in total, according to data from Messari.
The digital assets on CoinDesk 20 are in place on Wednesday. Notable Winners at 9:00 p.m. UTC (4:00 p.m. ET):