• July 21, 2024

Bitcoin at Cross Roads : $45K Marks as Make Or Break Level For BTC Price

Bitcoin has surged past $42,000, but the real buzz revolves around the critical $45,000 mark. This value is more than just a technical indicator; it’s a significant milestone for investors who got into Bitcoin two to three years ago. Their investments, representing a sizable chunk of the Bitcoin supply, are nearing the break-even point. 

Good Time for Investors, Been in Market 2-3 Years

According to CryptoQuant, the 45K level is the average cost basis for Bitcoin investors two to three years ago, making it important. As the price hits its initial investment value, these investors, who make up 16% of the Bitcoin supply and 33% of its capitalization, are at a critical point.

Interestingly, Bitcoin breached the $41,911 mark on Bitstamp, a year-to-date high. This is the first time Bitcoin has crossed $40,000 this year. Analysts credit this spike to heightened expectations for a Bitcoin exchange-traded fund and speculation about U.S. interest rate decreases. Whereas, giving high hopes Max Keiser and Michael Saylor predict $200K gains and the 2024 halving event might boost gains to $350K. On the flip side, JPMorgan warns caution, but in crypto, expecting the unexpected is the norm. The market is flooding with all sorts of predictions and in the middle is the reality of ETF which can give a fresh start to the year 2024. 

Meanwhile, looking at the Open interest in Bitcoin perpetual futures on Deribit it has also reached a yearly high of $740 million, a record not reached since November 2021 when Bitcoin reached its all-time high of over $68,000. Seems historically BTC has shown imminent market fluctuations and breaking its record is on the cards right? 

Bitcoin in a Greedy State: Good or Bad? 

Despite a recent price increase, the “Fear and Greed Index” currently rates the Bitcoin market as “Greed,” suggesting a positive outlook. From 0 (extreme fear) to 100 (extreme greed), the index describes the general state of mind and actions of investors. This score is lower than the ‘extreme greed’ values frequently linked with market tops, even if it’s 75.

Hence considering all the recent parameters it can be concluded that breaking $40,000 is more than a milestone; it represents the undeniable impact of Bitcoin. Everyone in the cryptocurrency world is getting excited as $45,000 approaches. Many are hoping that the SEC’s judgment regarding ETFs will have a profound impact on Bitcoin’s future. This landmark is not all about price; it is about the changing function of Bitcoin within the larger financial system.

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