The cryptocurrency market has been down for months now, but the bearish trend got worse recently with Bitcoin dropping below $26,000. It was the first time the top cryptocurrency dropped below this level since March.
However, the market has seen a slight rebound today 24 August. Bitcoin itself has gained 2.2% in the last 24 hours, causing the price to rise significantly above $26,000 to over $26.500 at the time of this report.
The top ten altcoins are not left behind, with the highest gainer being Solana with a 5.5% gain in the last 24 hours. Solana’s gain may be much higher than any of the top ten assets because of the recent news of its partnership with Spotify to bring USDC payments on the streaming platform.
Following Solana is Cardano, with 3.01% gain, and then BNB with 2.68% in the last 24 hours. All these top crypto assets had dropped significantly just a few days ago as Bitcoin dragged them down with it in the unprecedented crash.
The rally is coming just a day away from Fed chair Jerome Powell’s speech at Jackson Hole on Friday 25 August. Goldman Sachs says the speech, which is greatly looked forward to by the crypto community is likely to be like the previous ones, emphasizing focus on inflation reduction.
The speech can potentially affect the crypto market either positively or negatively, but it appears the community expects a positive impact this time around.
Bitcoin’s Strong Fundamentals
Despite the crypto market’s mostly bearish sentiment, there seems to be a ray of hope which seems to have affected investor sentiment, hence the rebound. Reports indicated yesterday that Bitcoin’s mining difficulty had reached a record high.
This has enormous implications concerning the short to medium term future of the top crypto asset. For example, an increase in mining difficulty shows that more miners are rushing to mine the asset in spite of the falling price.
Such a move is an indication that the miners have a good reason to believe that Bitcoin has a bright future, which is a reason for investors to be positive. In fact, a record high for mining difficulty means that miners have never been more positive about Bitcoin than they are right now.
Since Bitcoin mostly influences what happens to the general crypto market, positive sentiment around it can easily influence the market positively as well, which is a possible reason for the rally we are seeing.
Whales Remain Positive
Apart from miners, crypto whales have also been positive about the future of Bitcoin. This is backed up by data which reveals that more whales are holding unto their Bitcoin than ever. Specifically, recent data showed that the amount of Bitcoin on exchanges has reached a five-year low.
The data also suggests that Bitcoin whales are not bothered by the price movement of the asset which hasn’t been impressive recently. With such sentiment, the market has a bright future in the short to medium term.
The crypto community still awaits Powell’s speech tomorrow, which can significantly affect investor sentiment. However for now, investors seem positive, which means the market may continue to move upwards for the next few hours.
For many of the assets, the volume has also increased significantly, showing that investors are actually trading them.