The crypto scene continues to stay so hot that bitcoin is hitting one new high after another. It topped $72,700 on Monday. This initially stemmed from the approval of spot bitcoin ETFs, but is now being pushed higher ahead of a “halving” event, which will limit the amount of new supply put into circulation by bitcoin miners.
Bitcoin is up 9.5% over the past seven days and is up 50% monthly, according to CoinMarketCap data. The total crypto market cap across all tokens has increased by 10% on the week to $2.71 trillion, with bitcoin making up 52.7% of that amount.
There is, of course, no way to tell how high bitcoin might go during the current frenzy. While many are feeling the opium, there is at least one indicator that believes we are nearing the top of the highs, with price drops quickly following.
CoinMarketCap Crypto Fear & Greed Index it is in “extremely greedy” territory at 89.12 points, versus “neutral” at 59.3 points, in early February. The index measures the price and trading data of the largest cryptocurrencies, with user behavior data to measure cryptocurrency market sentiment from 0-100. When the indicator is closer to zero, investors have oversold their positions “irrationally”, compared to when the price is closer to 100, the market is likely to face a correction.
With that said, bitcoin remained the main focus for retail and institutional investors, with inflows of $2.6 billion for the week, also known as money placed into the asset, and $9.9 billion year-to-date, according to the Digital Asset Fund Flows Weekly by CoinShares. Report. Ether, the second largest cryptocurrency, is not directly benefiting from any hype about bitcoin. Its take last week was down $2.1 million, though it’s up $135 million year-to-date.
CoinShares Volume 173: Digital Asset Fund Flows Weekly Report. Image Credits: CoinShares
No matter how high investors will push bitcoin ahead of the bitcoin in half event, which is expected to happen in mid-April and happens every four years, there is no reason to believe that what goes up will not come down. Again. In previous cycles, bitcoin halvings have boosted demand and pricing for the cryptocurrency.
Bitcoin’s last halving was on May 11, 2020, and sent its price up about 600% from about $9,000 to $63,000 by April 2021. It then fell about 50% in three months, signaling renewed volatility for the asset.
