Bitcoin or BTC, the leading digital currency in the market, seems to have hit a setback from its yesterday’s high, which soared beyond $28,000. The descent, a 2% dip within a day to $27,240, appears to be a result of a collective reflection by the investors regarding yesterday’s court win by Grayscale against the U.S. Securities and Exchange Commission (SEC). Not outshining BTC, but certainly taking a lesser hit is Ether, staying just above $1,700 after a 1.7% slide in the past 24 hours.
While BTC and Ether controlled their downward spiral mildly, many altcoins such as ADA from Cardano, SOL from Solana, and MATIC from Polygon, saw a near 4% fall. The generally bearish tone of the broader crypto market was reflected in the 2.4% dip of the CoinDesk Market Index.
A glimmer of hope, throwing digital assets and crypto-related stocks into a short-lived frenzy, was the court’s decision concerning Grayscale and its $14 billion Grayscale Bitcoin Trust (GBTC). The court ordered SEC to revisit its rejection of Grayscale’s bid to transform GBTC into a spot bitcoin exchange-traded fund (ETF). Many market watchers see this as a potential stepping stone towards a future BTC ETF.
Only time will tell if yesterday’s price surge was sustainable or just a flash in the pan. Clara Medalie from Kaiko points to the modest trading volumes during the rally as a possible signal of the underwhelming strength of the move. On a brighter note, average BTC buy orders reaching their highest since June indicates participation from large investors.
The favourable winds of change in the form of a possible wave of ETF approvals could be the catalyst the crypto market needs, notes Clara, despite the fact we are still in the thick of a turbulent period in the industry.
However, not all are bullish about the future trajectory. Market analyst Garreth Soloway cautions of a probability of further downside for BTC, especially if it doesn’t break decisively above the $28,000 level, which was where it stood before the mid-August sell-off. BTC could see its value plummet even further if it continues to gravitate around its current limits, he asserts, drawing attention to the important support level at $25,000, the price when Blackrock filed for a spot BTC ETF in mid-June.
Source: Coindesk
