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| Bitcoin Surges Past $61K Amid Strong ETF Inflows and Market Dynamics: Potential for Continued Growth as Norway and Nigeria Show Interest in Cryptocurrency |
Bitcoin surpassed the $61,000 threshold early Tuesday, following the second-highest inflow activity into U.S. spot exchange-traded funds (ETFs) holding the cryptocurrency this month. SoSoValue data revealed that net inflows into Bitcoin spot ETFs totaled over $61 million, the most since August 8, when they received $192 million. While Bitwise’s BITB experienced outflows of $25 million, BlackRock’s IBIT led the inflows with $92 million.
Bitcoin's Technical Milestone and Market Reactions
The digital asset’s climb past the crucial $60,000 mark comes after several days of parabolic trading, marking a significant technical milestone. As of now, Bitcoin is approaching the pivotal 200-day moving average, which sits around $63,000 and is edging closer to $61,000. If Bitcoin can break above this level, it could potentially encourage traders and revive expectations for a prolonged upward trend. However, this sudden shift has also triggered a surge in liquidations, wiping out over $100 million worth of derivative holdings in the past day.
Upcoming Market Catalysts and Expectations
Currently, the market lacks significant catalysts, but traders are anticipating potential market movements later in the week. Jerome Powell, the Chair of the Federal Reserve, is expected to speak at the Jackson Hole conference on Friday, where he is anticipated to confirm a shift toward lower borrowing costs next month. This move has historically boosted trader optimism, as easier access to capital tends to spur growth in riskier assets like Bitcoin. However, some remain cautious about the possible withdrawal of proposed Bitcoin ETF options.
Bitcoin's Future Prospects: Resistance and Support Levels
If Bitcoin manages to recover to $62,000 or the 61.8% Fibonacci retracement level, it could form a crucial resistance zone aligned with the previously broken trendline and the 100-day Exponential Moving Average, currently around $62,226. Failing to exceed $62,066 could result in a drop to $57,000 and potentially a 19% decline back to the $49,900 daily support level. Conversely, if Bitcoin closes above $62,066, a move toward the high of $65,596 seen on August 2 could be anticipated, possibly leading to a further 6% rise and a test of the weekly resistance level at $69,600.
Norway and Nigeria Show Increased Interest in Bitcoin
Norway has indirectly invested in 2,446 BTC through its investments in cryptocurrency stocks, which signals broad government support for Bitcoin's value. Meanwhile, in another development, Nigeria’s Securities and Exchange Commission (SEC) announced plans to license providers of virtual assets, including cryptocurrencies, to tap into opportunities and protect investors. The SEC's initiative aims to formalize the cryptocurrency market in Nigeria, ensuring that all necessary information is gathered and the market is regulated effectively.
Background on Nigeria’s Cryptocurrency Stance
Previously, Nigerian authorities had banned banks from supporting crypto transactions due to concerns over traders manipulating the naira's exchange rate. The naira has depreciated by about 70% against the dollar since June last year. In February, the Nigerian government blocked access to Binance, the world’s largest crypto exchange, and later prosecuted its executives over allegations of illicit financial flows and speculation on the naira, which it claimed deprived the nation of tax revenue and weakened the local currency.
By The Numbers: Nigeria's Crypto Market Growth
Despite regulatory challenges, the volume of crypto transactions in Nigeria climbed by 9% to $56.7 billion in June 2023 compared to the previous year, according to a report by Chainalysis. This growth highlights the continued interest and participation in the cryptocurrency market within the country.
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