In just three days, the Bitcoin price has recovered from $5,850 to $6,500. Due to the establishment of Bitcoin’s new momentum, tokens and small market cap cryptocurrencies have risen in recent days.
Has the Market Reached Its Low Point?
Despite the expectations of prominent investors such as BitMEX CEO, Arthur Hayes, and Susquehanna Digital Asset Lead, Bart Smith for another sharp drop in Bitcoin’s value, the cryptocurrency, and the market has stabilized and may have bottomed out.
Both Hayes and Smith said last week that Bitcoin price and the rest of the crypto market are facing further correction before starting a mid-term rally as they need to stabilize and provide a foundation to launch the next bull rally.
Since July and August, most tokens, including Ontology, VeChain, and ICON, have fallen by nearly 80 percent over Bitcoin. Due to the instability and volatility of the public crypto-currency market, investors were reluctant to invest in high-risk, high-yield businesses.
In the last three days, the trend has reversed. Ethereum-based tokens, which underperformed Bitcoin and the US dollar in July and August, posted massive gains within 48 hours. Nano, ontology, VeChain, Aion, Nebel, Pundi X and Waltonchain, tokens that suffered 50 to 90 percent losses against Bitcoin, posted a 20 to 50 percent increase over Bitcoin in a short period of time.
Given that investors have begun to tokenize their large cryptocurrencies, one can say that individual investors have started taking more risks. Smith, a respected investor, and analyst added that the introduction of a Bitcoin Exchange Traded Note (ETN) in US markets is likely to attract new investors in the coming months.
Is Another Correction Due?
It is still possible that the valuation of the crypto market after Bitcoin has found a momentum above the $7,000 mark, and tokens are making absurd profits in the short term. But in the short term, at least in the coming weeks, the market is very optimistic and investors have begun to trade high-risk assets, reflecting investors’ growing confidence in the asset class.