The market has attracted an inflow of about $48 billion from $1.97 billion to $2.04 billion, data provided by CoinMarketCap indicates. The valuation has been led by high-cap cryptocurrencies like Bitcoin and Ethereum. For instance, Bitcoin has gained over 2% in the last 24 hours to trade at $43,000, while Ethereum was valued at $3,200 by press time. The gains point to bullish market sentiment, considering that most digital currencies have been trading in the red zone over the last two months. Notably, the market has shed at least $1 trillion from the mid-November 2021 peak. Worth noting is that a potential recovery has been lingering over the last week following an uptick in investor sentiment across the global financial markets. The uptick followed remarks by Federal Reserve chairman Jay Powell that the institution would do everything to stop inflation from “becoming entrenched”. Furthermore, if the recovery is sustained, it will eliminate the notion that the market is entering a crypto winter. Although the market volatility began in 2021, recording significant capital losses, proponents of the sector have maintained that the correction is near term.
Market to benefit from possible spot Bitcoin ETF
The slight recovery also comes over the possibility of rolling out new Bitcoin-related investment products like spot Bitcoin exchange-traded fund (ETF). This emerged after the U.S. Securities and Exchange Commission (SEC) chair Gary Gensler called for active supervision of the crypto trading platforms. Following the sentiments, Bloomberg’s senior ETF analyst Eric Balchunas believes it’s a hint of approving a spot Bitcoin ETF. It will be interesting to see how the product impacts the market considering that SEC has been rejecting several applications. The recent volatility can also be tied to various aspects around the market, with regulatory uncertainty ranking top. In this line, Russia has become the latest high-profile country to propose a crackdown on Bitcoin and the general crypto sector. As reported by Finbold, Russia’s central bank has proposed a ban on cryptocurrency trading, mining, and usage. Notably, the proposal comes after the institution finalized working on a paper expressing its vision for the role of crypto in the country’s financial sector.
