Last month saw one of the largest value losses in cryptocurrency history. Bitcoin and the general crisis of the cryptocurrency market was affected by the collapse of the Terra and UST ecosystem. For its part, Bitcoin plummeted below $30,000 after several days of uncertainty and lows were reached below $27,000. Obviously, institutional players took advantage of the occasion to get hold of more BTC at discounted price.
Why doesn’t the price of bitcoin move after weeks in the area of USD 30 thousand?
Following the fall of Terra and UST, which shook the entire crypto market, the institutions reportedly invested $300 million in Bitcoin ETFs, according to CoinShares reports. In the second week of May, a record for weekly cryptocurrency inflows was recorded so far in 2022. Weekly net inflows were $274 million in the previous week.
While North American investors pumped $312 million into cryptocurrency the week after the $30,000 drop, European investors saw a net outflow of $38 million, according to the CoinShares report.
Investors saw the recent declassification of US stablecoins and the associated sell-off as a buying opportunity. Bitcoin was the main beneficiary, with inflows totaling $299 million last week, suggesting that investors flocked to the relative safety of the biggest digital asset.
Nevertheless, after weeks of this injection of capital we see that the price of bitcoin has not moved to a great extent From the zone of minimums that marked May 9 and 12, what is the reason for this event? In part, to the uncertainty that invaded the market after the Terra y Luna scandal. On the other hand, it could be a reflection of the global macroeconomic situation caused by the Russo-Ukrainian conflict and inflation in several countries.
The outlook for the following months in crypto
Yes ok it is not possible to predict the future, at least bitcoin has not come dangerously close to the zone of 20 thousand dollars at the moment. As long as the USD 27,500 area is not lost, there should be no fear of strong price declines towards lower supports. In the event that the macroeconomic situation continues without notably worsening in the coming months, one might think of a recovery towards the end of the year. However, there are currently several questions about these issues since inflation is not easy to alleviate and, on the other hand, the Russian conflict has not yet ended. Undoubtedly, the sanctions that are imposed will to a certain extent shape the performance of world markets for the following quarters. Meanwhile, bitcoin, Ethereum, and the other cryptos could continue in the accumulation phase at the expense of more stability in the markets.
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