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The price of Bitcoin is struggling to regain $30,000 as it was at the time of writing this article. The price did not hold above the critical threshold. We have been talking about how closing below $30,400 for days could lead to a new bottom around $29,700. And that’s what happened. So what will happen next?
What Will Happen to Cryptocurrencies?
Investors were expecting an upward breakout after multiple institutional spot ETF applications, but the price of Bitcoin has been fluctuating between $29,500 and $32,000 since the end of June. However, an analyst claims that the approval of BlackRock’s application is a “distant possibility.”
Chris Bendiksen, the Bitcoin research leader at CoinShares, sees a triple challenge causing the current stagnation of BTC.
Will the Spot Bitcoin ETF Be Approved?
The first challenge highlighted by the analyst was the exhaustion of buyers. Bendiksen stated that after the rally caused by the Bitcoin ETF application, buyers have started to weaken and disappear. BlackRock’s application on June 15 led to a Bitcoin rally that surpassed $30,000. BTC has been stagnant at this level throughout the past month.
“However, despite some changes in BlackRock’s applications and Coinbase partnering with CBOE for a surveillance-sharing agreement, we still think the approval of a spot ETF is a somewhat distant possibility.”
But the comments from BlackRock’s CEO were important. Chris said:
“Larry Fink sitting on major financial news channels and speaking positively about Bitcoin is beneficial in itself.”
US Department of Justice
Bendiksen said the second challenge preventing Bitcoin from breaking out of its current range is the attention of US officials shifting towards the Binance exchange. Bendiksen emphasized that there is a widespread belief in the markets that the US Department of Justice will take action against the exchange.
In early June, two US congressmen alleged that the Binance exchange had lied about its relationship with BinanceUS. Bloomberg reported in a letter sent to US Attorney General Merrick Garland that the crypto exchange may have made false statements.
XRP Coin Lawsuit
Bendiksen said the third obstacle to Bitcoin’s upward trend is the recent rotation towards altcoins after the summary judgment on XRP, which he called the “rotation towards altcoins.” After Ripple’s partial legal victory against the SEC, Bitcoin’s market dominance dropped below 50%. The decrease in dominance was accompanied by altcoins attracting more liquidity.
Following the Ripple decision, XRP became the fourth-largest cryptocurrency with a 73% jump. Other altcoins such as Ethereum, Cardano, Solana, Polygon, and Stellar also recorded double-digit growth.
