Bitcoin, the leading cryptocurrency, has recently found significant support at the $26,000 level, forming a double-bottom pattern. This level has proven to be a strong support zone for BTC, indicating a potential bullish reversal. Japan’s upcoming stricter regulations for crypto exchanges and a decline in crypto attacks worldwide are attracting attention for their potential impact on Bitcoin’s price prediction.
On June 1st, Japan will enforce stricter anti-money laundering (AML) regulations for Bitcoin transactions, aiming to align Japan’s legal framework with international cryptographic standards. These regulations were developed in response to hacking incidents at Mt.Gox and Coincheck, and include protective measures such as asset segregation, annual audits, leveraged trading ban on exchanges, and cold wallet storage requirements. The upcoming regulations in Japan have added pressure to the BTC/USD prices, which were already experiencing a decline due to increasing wave of cryptocurrency regulations worldwide.
However, there is a silver lining: the first quarter of 2023 saw a 70% decline in assaults and hacks on cryptocurrency protocols, with average hack size dropping from nearly $30 million to $10.5 million. These improvements can be attributed to factors such as improved cybersecurity practices, stronger regulations, and increased industry collaboration. TRM Labs also noted that victims of cryptocurrency theft were able to recover over 50% of their stolen funds in Q1 2023. While these findings are favorable for the crypto market, they have not resulted in an upward push for BTC prices.
Bitcoin has also received support from Florida Governor Ron DeSantis, who expressed his support for Bitcoin as a matter of civil liberties and criticized opponents’ efforts to impose restrictions on cryptocurrencies as an example of government overreach. DeSantis added his commitment to vigorously oppose any congressional attempt to ban cryptocurrencies like Bitcoin. This support from DeSantis is helping to limit the losses in Bitcoin for the day.
Despite the support at the $26,000 level, Bitcoin faces resistance at the $26,600 level, which is further strengthened by the presence of the 50-day exponential moving average. If Bitcoin drops below the $25,800 level, it may target the $25,500 level as a downside target. However, oversold conditions indicated by RSI and MACD indicators suggest the possibility of a minor bullish correction. Close monitoring of the $25,800 level is crucial, as a breakout above it could lead to a modest bullish correction towards the $26,400 or $26,600 levels.
In conclusion, while the upcoming stricter regulations in Japan and the recent decline in crypto attacks have generated mixed reactions in the crypto community, Bitcoin has found significant support at a critical level.The support from Florida Governor Ron DeSantis provides a glimpse of hope for Bitcoin enthusiasts. It remains to be seen whether the positive developments will outweigh the challenges and lead to a potential upward trend for Bitcoin.