Bitcoin increased by more than 80% to above $30,000 per coin, much higher than the increase of stocks, gold, and crude oil.
After a turbulent 2022 that saw the collapse of the FTX exchange and other crypto companies, Bitcoin was trading around $16,600 a coin at the start of the year. The world’s largest cryptocurrency gained more than 70% in the first quarter, its best quarterly gain since Q1 2021.
Bitcoin has been volatile in the second quarter, rising steadily to over $30,000 in April, when global investors rushed to find shelter after the collapse of two US banks, Silicon Valley Bank and Signature Bank. Then, Bitcoin's market price weakened when the US Securities and Exchange Commission (SEC) sued Coinbase - the largest US cryptocurrency exchange and Binance - the largest cryptocurrency exchange in the world.
However, Bitcoin managed to recover to over $31,400 per coin, the highest since May 2022. In conclusion, the world's largest cryptocurrency still increased by 7% in the second quarter. Overall, compared to the beginning of the year, Bitcoin has accumulated an additional 84.3% in market value. The above increase is superior to that of US stocks, European stocks, Japanese stocks, spot gold...
This year, despite the decline of many investment channels due to macro fluctuations, Bitcoin has had many unexpected price increases, beyond the predictions of analysts. The world's largest cryptocurrency has surpassed 30,000 USD per unit, almost maintained for the past two weeks. Stocks of companies with business and investment activities related to digital assets have also increased sharply in market price, many codes achieved triple-digit performance after 6 months.
In the recent price surge, CNN explains that the participation of financial giants is a big driving force. In mid-June, BlackRock - the giant in the field of global asset management, registered to establish a Bitcoin ETF. Cryptocurrency exchange EDX Markets - backed by financial giants Charles Schwab, Fidelity Digital Assets and Citadel, also launched late last month.
Fear of missing out (FOMO) is also a factor in the bull run. Some investors are jumping into the market because they see others reaping the benefits of the ongoing bull run and want to get in on the action. Investors are hoping the Federal Reserve will stop raising interest rates, which will help cryptocurrencies benefit from a low-interest-rate environment and act as a safe haven from the volatility of traditional finance.
However, Bitcoin still faces many risks in the coming time. First of all, US authorities always maintain the view of wanting to tighten control over the cryptocurrency sector. According to CoinDesk , in addition to suing the two major exchanges, the SEC will hold great "power of life and death" when it is the unit that decides whether to approve the Bitcoin ETF registered by BlackRock or not, expected to take place in August. Observers are certain that if the SEC rejects BlackRock's application, the cryptocurrency market will immediately plummet.
Despite nearly doubling in the first half of the year, Bitcoin is still far from its peak of more than $60,000. Not to mention, despite the price increase, cryptocurrency trading volume is generally low. CNBC cited data from market research firm Kaiko showing that Bitcoin's liquidity has dropped 20% since the beginning of this year. According to cryptocurrency data website CoinGecko, the market's daily trading volume is currently around $24 billion, down significantly from more than $100 billion at its peak two years ago. Some say Bitcoin is now a "whale's playground" and there are almost no individual investors actively trading it.
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