Cryptocurrency market falls have been dominating in recent days, despite Bitcoin’s (BTC) success in surpassing the $100,000 crucial milestone. The seasoned expert now clarified why the price of Bitcoin has been unable to climb, despite.
The fact that it has been fluctuating between $90,000 and $100,000 in the past few weeks. Founder of 10X Research Markus Thielen warned clients in a note that Bitcoin’s rise climb could be slowed down by slow liquidity inflows and Nvidia’s stalling rally.
Bitcoin’s Rise Stalls Liquidity and Nvidia’s Impact
To start, Thileen said that the market’s rising momentum has been impeded since the flow of liquidity into the cryptocurrency market through channels like spot Bitcoin ETFs has slowed down considerably.
The analyst said that Nvidia is another roadblock to the ascent of cryptocurrencies, adding that other technical indications besides ETFs show that the market’s net liquidity inflow has slowed down.
The analyst went on to say that the ascent of Bitcoin’s Rise and other cryptocurrencies was stymied by the halt in the advance of Nvidia (NVDA), a trailblazer in AI and risk assets. Bitcoin has had a hard time staying above $100,000, and this decline in liquidity growth might be the reason why.
Shares of Nvidia, the biggest chipmaker in the world, have slowed their upward path, which is another reason that has been neglected. After hitting rock bottom in late 2022, the relationship between BTC and NVDA has been strongly favorable ever since, with the exception of the summer.
But since the middle of November, NVDA’s upward trajectory has decelerated. This is the second factor that is preventing Bitcoin from reaching its full potential. The current price of one bitcoin is $97,780.
Effect on Bitcoin’s Value
The general mood of the cryptocurrency market has a significant impact on Bitcoin’s price. Although Bitcoin was once the undisputed leader. Altcoins such as Ethereum, Solana, and others are currently drawing in increasing users and funding. With the release of Ethereum 2.0 and the meteoric rise of decentralized finance (DeFi) platforms. Ethereum, in particular, has been drawing substantial investments from institutional investors.
Competition has intensified due to the proliferation of exchange-traded funds (ETFs). The increasing involvement of conventional financial institutions in the cryptocurrency market. Even though Bitcoin ETFs have received over $34 billion in the past few months. Investors are starting to pay more attention to alternative cryptocurrencies that have greater potential in the decentralized finance and non-fungible token industries.
As investors are expanding their portfolios into a wider variety of digital assets, these new trends have also had an impact on Bitcoin’s market dominance. This has diminished Bitcoin’s hegemony and made it more difficult for it to propel the market upward.
In Summary
The price surge of Bitcoin’s Rise has encountered several obstacles. Such as rivalry from other cryptocurrencies, rising mining difficulty, and resistance at important price levels. Its price growth has been further slowed by institutional prudence, regulatory uncertainty, and general market mood.
However, after the present challenges are resolved, the long-term picture for Bitcoin is still bright. The price may continue to climb due to falling supply and increasing demand. The market is taking things slow for the time being. But Bitcoin has proven time and time again that it can weather storms and even shock its rivals.
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