Top cryptocurrency Bitcoin (BTC) continues its rise, defying skeptics who predicted a decline following Bitcoin ETF approval. This week alone, BTC has gained over 12%, currently hovering around $47,000. It also points to a rise in anticipation surrounding the upcoming halving event. This rise was not limited to Bitcoin alone, many altcoins also experienced significant increases. But is this a pre-halving rally or is it just FOMO (Fear of Missing Out) driving the price?
What’s behind Bitcoin’s rise?
The reasons behind Bitcoin’s rise are not fully known. However, several important factors potentially played a role.
- FOMO Effect: Fear of Missing Out (FOMO), that is, “fear of missing out”, is a very common feeling in the cryptocurrency markets. It is possible to think that FOMO played a role in Bitcoin’s recent rise. As the price rises, investors have the potential to buy for fear of missing out on the trend. This causes the price to rise even further.
- Rally Before Halving: Bitcoin experiences an event called “halving” every four years. In this event, Bitcoin’s production rate is halved. The pre-halving rally is explained by the fact that investors tend to accumulate Bitcoin before this event. Since halving will make the supply of Bitcoin even more scarce, the price is expected to increase.
- Altcoin Season: The fact that Bitcoin has been in an upward trend for a while causes investors to turn their attention to altcoins. This triggers a bullish wave in altcoins.
- ETF entries: Strong inflows into Bitcoin ETFs are supporting the price action. This shows institutional interest and sustainable growth potential.
- Technical indicators: Recent liquidations show that short positions are being squeezed. So it shows that it causes more upward pressure on the price.
Expert opinions
There are many different opinions about the future of Bitcoin and altcoins. While some experts believe that the rise of Bitcoin and altcoins will continue, others say they expect a correction. It is important for investors to make investment decisions by taking these different views into consideration and doing their own research. However, some prominent analyst comments are as follows:
- Rekt Capital: Based on historical models, he predicts a pre-halving rally, with the potential for early bullish momentum.
- Ali Martinez: It suggests that liquidation hunters may try to push the price down to trigger more liquidity, creating volatility.
- CryptoQuant: He sees similarities to the 2020 bull market, with healthy and sustainable upside potential. According to CryptoQuant, open interest in the BTC futures market has reached its highest level since January 2023, when BTC reached its previous peak of $42,000.
upcoming process
As we approach the halving in two months, Bitcoin’s rally holds promise but also risks. Increasing adoption, recognition as a store of value, and limited supply support further growth. However, investors should be wary of potential volatility and corrections. Careful observation of technical indicators, expert opinions, and market sentiment are crucial to navigating this dynamic environment.
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