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Bitcoin Experiences 3% Price Surge Amid Reduced Supply on Exchanges and Increased Institutional Interest

Algoine News
Summary:
Bitcoin's price has surged over 3%, hitting a one-week high of $27,300. This increase coincides with a drop in BTC supply on crypto exchanges as traders withdraw to hold onto their assets long-term. Institutional interest from large entities like BlackRock and Fidelity Investments is playing a key role in price surge and investor sentiment. However, the SEC continues to reject spot Bitcoin ETF approvals from various applicants. Despite the challenging situation, long-term holders’ resolve contributes to Bitcoin price stability, accounting for 76.1% of the total outstanding BTC supply. While this depicts positive price momentum, the Bitcoin Fear & Greed Index indicates the market remains apprehensive.
Today, Bitcoin (BTC) experienced a price surge, recording an increase of over 3%, which took its value to the $27,300 mark. This rise is especially significant as it marks a one-week high for bitcoin and an overall 4% gain throughout September. The exact reason behind this abrupt increase, however, remains largely speculative. Concurrent with the increase in Bitcoin's value, a significant reduction in BTC supply on exchanges was observed, remaining below the monthly peak of September 4th. More than 40,000 Bitcoin were removed from exchanges following this peak. It's generally viewed positively when traders withdraw their BTC from exchanges, as it often indicates their intention to hold onto the cryptocurrency for the long term. This substantial withdrawal of Bitcoin can potentially impact its price. Reportedly, Bitcoin shorts worth over $21.5 million were liquidated in the last 24 hours, with over $17.4 million liquidated within a 12-hour span. Despite the losses, still, 51.5% of the futures market remains pessimistic on Bitcoin's future. A potential short-squeeze occurrence could provide further upward movement for Bitcoin's value. The institutional interest in Bitcoin has seen a notable increase, which might also be driving investor sentiment. This interest was piqued following a ruling in favor of Grayscale Bitcoin Trust (GBTC) by U.S. Court of Appeals Circuit Judge Neomi Rao on August 29. Consequently, numerous large institutions submitted requests for ETFs, despite Gary Gensler, SEC Chair, maintaining ambiguity over Bitcoin's status as a commodity. Companies like BlackRock and Fidelity Investments have shown increasing interest in Bitcoin, with both institutions awaiting BTC spot ETF approvals as of September 2. The globally renowned asset manager Franklin Templeton submitted an application to the SEC for a spot Bitcoin ETF on September 12. Still, the SEC continues to reject spot Bitcoin ETF approvals from various applicants, including BlackRock and Fidelity. To safeguard the BTC for their trust, BlackRock intends to engage services from Coinbase, as per their SEC filing. The decision on the next set of ETFs, initially due on October 16, has been deferred by the SEC. Even amidst turmoil caused by the SEC's stance against Bitcoin ETFs, long-term Bitcoin holders remain optimistic. It is believed that this resolve has contributed to Bitcoin's price stability amidst challenging macroeconomic conditions. On September 28, it was recorded that long-term Bitcoin holders hold 76.1% of the total outstanding BTC supply, marking an all-time high. Moreover, while Bitcoin's price shows positive momentum, the Bitcoin Fear & Greed Index suggests that the market remains apprehensive, even though it is up by 7 points compared to the previous month. Please note, this article does not offer financial advice or recommendations. Every investment and trading action carries risk, so it's crucial that individuals conduct their own research before moving forward. Show your support for independent journalism in the crypto industry by collecting this article as an NFT.

Published At

9/28/2023 7:06:22 PM

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