The crypto market is on a roll, with Bitcoin topping $63,000 and a whopping $370 million poured into the Spot Bitcoin ETF. This surge also boosted other major altcoins such as Ethereum, Solana, and Cardano, and the global cryptocurrency market capitalization increased by 5.11% in just 24 hours, despite an 18% drop in trading volume. It reached a huge amount of $340 billion.
Blockbuster Question: Why?
What is causing the crypto comeback?
Revitalizing the US economy
Despite some ups and downs, recent U.S. economic data has given investors confidence, particularly in employment and manufacturing. Despite a slight decline in the manufacturing industry, with the PMI falling to 49.2%, the number of job openings in March remained steady at 8.5 million. Employment rose by 175,000 people, slightly lower than expected, while the unemployment rate rose to 3.9%. Hourly wage growth was 0.2%, slightly short of the expected 0.3%.
Despite these twists and turns, investors remain optimistic about jobs and manufacturing, demonstrating confidence in the crypto market amid economic uncertainty.
Bitcoin ETF fluctuations
Investor mood has fluctuated with the flow of Bitcoin ETFs, experiencing steep drops and spikes, significantly increasing confidence in the cryptocurrency sector. It is worth noting that on May 1st, a huge amount of $563.7 million was outflowed from the US Spot Bitcoin ETF. However, recent data shows a notable turnaround, with inflows dropping to $34.4 million on May 2nd, but rebounding to $378.3 million on May 3rd, increasing investors' I renewed my interest. Confidence.
Also read: Bitcoin Maximalist Michael Saylor Predicts No ETFs for XRP, ETH, BNB, ADA
Hong Kong adopts virtual currency ETF
Hong Kong's adoption of Bitcoin and Ethereum ETFs has brought about major changes in cryptocurrency prices. Huaxia, Harvest International, and Boshi Bitcoin ETFs combined for him to collect a whopping $258 million within a week. Hong Kong's acquisition of 4,218 BTC in three days highlights the growing interest in digital assets. Although it still falls short of the U.S. in first-week ETF trading volume, this has breathed new life into the hitherto sluggish crypto market.
Pension Plan Eye Crypto
A notable trend is that pension plans are focusing on crypto investments, indicating a shift in institutional investment strategies and increasing positive sentiment in the crypto market. Fidelity Digital Assets has revealed that there is growing interest in crypto assets among pension funds. Fidelity's Manuel Nordeste said interest from family offices and high-net-worth individuals is increasing.
However, while 80% of individuals support cryptocurrency investments, only 23% of pension plans actively participate, revealing disparities in adoption rates.
Read more: Fidelity reveals $5 trillion crypto potential for pension plans: What you need to know
The trend of “buying on the spur of the moment” is gaining support.
The idea of “buying the dip” encourages investors to view the recent price drop as a great buying opportunity, especially with Bitcoin’s halving event just around the corner. Historical data shows that cryptocurrencies tend to soar after halving events, fueling investor optimism.
The recent rally in cryptocurrencies mirrors past patterns seen after the Bitcoin halving. Looking at past trends, combined with the introduction of spot Bitcoin ETFs in the US and Hong Kong, we can expect gains after the halving.
What do you think about the recent surge? Are you bullish or bearish?
