Bitcoin continued its upward trend in week 5, ending January right where it started the month - around $42,300. Given that Bitcoin had dipped to around $38,500 in week 4, this rise highlights a positive development, and it remains intriguing to see if it will persist into February.
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Bitcoin began the week trading around $41,821, with the week's high/low reaching $43,654/$41,821, respectively. By the end of the week, Bitcoin closed at $42,754, representing a 2.23% increase. Trading volume fluctuated between $5 billion and $26 billion.
As mentioned in week 4, there was an unusually large selling pressure for Bitcoin following the approvals of the spot ETFs, although the ETFs themselves are very positive news for Bitcoin and its adoption. Ark Invest, led by the prominent Cathie Wood, emphasized in their week 5 report for 2024 that ETFs were one of four catalysts for Bitcoin in the current year.
The next catalyst for Bitcoin will be the Bitcoin halving in mid-April, as we've mentioned before. Ark Invest highlights what many have observed; historically, the halving has signaled the beginning of a significant uptrend for cryptocurrencies. They also note that Bitcoin's inflation rate will decrease from 1.8% (annually) to 0.9%.
According to Ark Invest, the third catalyst will be increasing regulatory developments. This will help create predictable conditions and frameworks for actors in the crypto industry, making it safer for consumers. Previously, regulatory authorities, especially in the USA, have cracked down on exchanges, etc., without necessarily highlighting what they need to correct. Many have felt ordered to change their business behaviour without being told specifically what needs to change. For an actor like NBX, this is still good news - we already operate in accordance with what MiCa will impose on actors and exchanges within cryptocurrency in the EU.
In conclusion, Ark Invest notes that the perception of Bitcoin has and will continue to shift from a speculative "bet" to a strategic investment instrument in a diversified portfolio. They highlight the same as we did in November, namely that the change in perception can be symbolized by Larry Fink, CEO of BlackRock, the world's largest asset manager. Previously, he referred to Bitcoin as: "..an index of money laundering," whereas now he says that both Bitcoin and cryptocurrency can revolutionize finance.
This text is intended for informational purposes and is not an investment recommendation.
Best regards,
Adam Jakobsen.
NBX.
