Bitcoin’s price forecast continues to remain unchanged despite the world’s largest digital asset by market capitalization being in the news recently due to its recent surge in trading volume. With more than $40 billion in trading volume in the past few days, the market is on a tear, and many investors are wondering what this could mean for the future of Bitcoin.
In this update, we will explore the impact of this surge in trading volume on the price of Bitcoin and analyze the role of whales in the current market scenario.
Despite concerns among some crypto traders about possible regulatory shocks in the near future, a group of high-profile investors remains unfazed. After temporarily suspending Binance USD deposits and withdrawals, a crisis scenario could arise if no US banks offer support.
While things may clear up next week, the recent $30 million settlement between Kraken and the US Securities and Exchange Commission (SEC) has caused a sudden drop in market prices.
After the deal, Coinbase CEO Brian Armstrong warned that the SEC could potentially ban the cryptocurrency stake altogether. Against this background, recent remarks by SEC Chairman Gary Gensler suggest that crypto companies will be required to provide full disclosure, further confirming the possibility of such actions in the future.
In fact, Gensler went so far as to say that complying with US laws on full and accurate disclosure may be the only way for crypto companies to remain viable.
Analysis of the role of whales
Whales are large investors who own a significant amount of a certain asset and have the ability to significantly influence the market with their actions. In the cryptocurrency market, whale activity can have a significant impact on the price of digital assets, including Bitcoin.
Recent data and statistics suggest that the current surge in trading volumes may be due to the attraction of whales to the market. Analyzing their performance provides valuable information about market trends and can help investors make informed decisions.
Bitcoin whales, individuals who hold more than $1 million worth of BTC, took advantage of the price drop by buying more at current prices. On-chain data shows that this buying frenzy was especially high after the November 2022 FTX crash.
The behavior of these whales suggests that the negative sentiment related to Kraken’s suspension of crypto staking services will not last long, and that they see an opportunity to buy significant volumes of BTC below the $22,000 threshold.
IMF: El Salvador’s ‘Limited’ Bitcoin Use Reduces Projected Risks
The IMF has warned El Salvador to be cautious about expanding the government’s involvement in bitcoin, as the speculative nature of the digital currency has caused its prices to fall.
Despite the “limited” use of bitcoin in the country, the IMF highlighted risks to El Salvador’s fiscal sustainability, consumer protection and financial stability.
The IMF emphasized the need for greater transparency in both bitcoin transactions and the financial health of the state-owned Chivo wallet. As the use of bitcoin as legal tender in El Salvador may grow, the IMF has advised the country to review plans to issue tokenized bonds, which pose legal and financial risks.
The IMF advises El Salvador to avoid issuing tokenized bonds
The IMF recommended that El Salvador refrain from issuing tokenized bonds due to their legal and financial risks. The statement highlights the speculative nature of crypto markets and the country’s fiscal vulnerability, emphasizing the need for caution when increasing government influence over bitcoin.
The IMF has called for more transparency into the financial health of the Chivo wallet, as well as bitcoin transactions in El Salvador.
PayPal Halts Stablecoin Project After Report of $600 Million in Cryptocurrency Holdings
According to the report, PayPal held $291 million in Bitcoin and $250 million in Ethereum, along with an additional $63 million in other digital assets such as Bitcoin Cash and Litecoin (no breakdown provided). The company noted that a third-party custodial service provider held these assets in its name for the benefit of its clients.
PayPal identified the uncertain regulatory environment as a risk to its business, citing the unclear legal status of some cryptocurrencies and the potential need for additional licensing due to the changing regulatory environment. The company has expressed concern that its current and future cryptocurrency customer offerings may result in additional regulatory obligations.
The lack of regulatory clarity in the US is a growing concern for crypto companies, as seen in the recent enforcement action against Kraken by the SEC, which resulted in a $30 million fine for the exchange.
Bitcoin price
The price of BTC is $21,810 with a 24-hour trading volume of $15.3 billion. It is up 0.45% in the last 24 hours with a #1 ranking, a market cap of $420.7 billion, 19.3 million in circulation, and a maximum supply of 21 million BTC.
On Saturday, Bitcoin breached a key support zone at $21,875, raising the possibility of a bearish trend in BTC. A bullish breakout of this level could lead to the next resistance levels at $22,300 or $22,850.
However, if it fails to break below the $21,750 level, it may extend its decline towards the $21,200 level. If the price of BTC falls below this level, it could fall sharply to $20,600, which is its immediate support.
