He outlook in the cryptocurrency market has maintained relative stability in the last 24 hours. While Bitcoin (BTC) seems to have found a stabilization point near $71,000, Ethereum (ETH) shows a pronounced decline, although it manages to stay above $3,500.
Red dominates in the rest of the ‘altcoins‘. Toncoin (TON) continues to be highly volatile, recording a loss of more than 5% in the last day, while other cryptocurrencies such as solana (SOL), XRP, cardano (ADA) or avalanche (AVAX) show moderate falls. In contrast, Binance coin (BNB) and dogecoin (DOGE) are some of the few tokens showing an upward trend.
Despite the apparent quietness of BTC in recent hours, the main cryptocurrency has seen a 5% increase in the last week and is expected to maintain its high volatility in the short term, according to analysts. This is partly due to the proximity of the ‘halving’, an event that will halve the rewards per mined blockscheduled to be completed between April 19 and 20, which will likely trigger a spike in BTC price volatility.
What can be expected next week is an increase in Bitcoin’s implied volatility, reversing last week’s downward trend. The Implied volatility for the next two weeks is the one that has experienced the greatest increasegoing from 59% to 71% in just two days. This suggests an increase in short-term volatility expectations, analysts say.
On the other hand, they highlight that in early April, bitcoin’s 30-day realized volatility reached its highest level since the end of 2022, significantly surpassing that of gold and other traditional assets. Despite this increased volatility, crypto assets continue to offer strong risk-adjusted returns, with BTC outperforming most other assets. This shows that cryptocurrency investments can adequately compensate for their volatility, they point out.
Halving: what the market expects
However, some analysts believe that the impact of the ‘halving’ on prices may not be as pronounced as on previous occasions, which could lead to it being confirmed as a “buy the rumor, sell the news” event. Despite this, some remain optimistic about bitcoin’s prospects, although rallies could take longer than expected to materialize.
One of the factors leading some analysts to believe that the halving could be less impactful than anticipated is the boost provided by BTC spot exchange-traded funds (ETFs), that led bitcoin to reach all-time highs last March. Although this momentum appears to have slowed in recent weeks, the stabilization of net capital outflows into the Grayscale Bitcoin Trust (GBTC) offers a positive sign.
In recent days, GBTC outflows have decreased significantly compared to last week and especially March, despite a slight increase recorded yesterday compared to the previous day. Some analysts believe that, with the normalization of fund fees, the flows will eventually reverse and drive prices higher again. However, Kaiko warns that a bearish reversal could flood the market with BTC, creating uncertainty.
Outside the scope of the market, Sam Bankman-Fried, former CEO and founder of FTX, He filed an appeal against his conviction on fraud and conspiracy charges just hours before the deadline. Bankman-Fried was convicted last November for his role in the collapse of a crypto exchange, and in March, the court sentenced him to 25 years in prison.
Source: Ambito
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