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Ripple's victory may not last

Last week, XRP's price jumped 70% after a judge refused to recognise token trading on cryptocurrency exchanges as securities transactions. US platforms immediately announced the return of XRP trading pairs. Soon after, altcoins that the US Securities and Exchange Commission (SEC) had previously called securities recovered their June losses.



Demand for XRP trading has been so strong these days that some cryptocurrency exchanges have found it difficult to conduct transactions, and the token is still leading by a wide margin in terms of liquidated positions per day.



At the same time, industry experts point to clear contradictions in the court ruling and the risk of it being overturned on appeal. It's all about the dual approach to determining the status of XRP, which, according to the judge, is a security when sold to institutional investors and isn't one when sold to retail investors.

John Reed Stark, who chaired the SEC Office of Internet Enforcement for 11 years, criticised the court ruling: "Securities laws were specifically designed to protect individual investors, based on the idea that they can't fend for themselves... The Ripple decision turns this notion on its head."

As Stark explains, institutional investors can count on the SEC's legal protection when buying a token. If the issuer violates the rules, it faces fines of up to and including cancellation of its licence. If individual investors purchase the same token, the issuer isn't liable for financial wrongdoing.

Moreover, the court's designation of 'programmatic sales' as a separate asset subclass will lead to the emergence and spread of sub-tokens on unregulated crypto platforms. Investors will find themselves defenceless. For this reason, the SEC is obliged to appeal, Stark believes.

Attorney Bryan Jacoutot agrees with Stark but also suggests keeping an eye on the upcoming trial regarding the illegal sale of nearly $1 billion worth of tokens to institutional investors. Because XRP is treated as a security in this case, Ripple faces federal law violation charges and multi-million dollar fines.



Ripple investors shouldn't celebrate this early and should be cautious in their investment decisions. The SEC appeal and the hearing of the 'XRP sale to institutional investors' case could hurt the coin's value.


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Three metrics of Bitcoin's sustainable demand

Bitcoin's continued consolidation around the $30,000 level over the past month is raising more and more questions about the price direction in the near future. Let's look at three metrics demonstrating strong demand for cryptocurrency, which could eventually lead to a price increase.

Realised cap (RC)

RC is calculated by both the average price and the price of the last movement of each coin. When the indicator rises, it shows that coins are being bought at increasingly higher prices and that demand is increasing. In 2023, RC amounted to $396 billion, demonstrating sustainable, though not explosive, growth after reaching the local bottom.



For more clarity, let's look at the realised cap drawdown indicator. The 2022 collapse was the second largest, and the drawdown reached 18.8%. Cap recovery is proceeding at the same pace as in previous cycles at a rate of 0.1% per day.



Coins without movement

The greater investor confidence in future growth is, the stronger the hoarding sentiment is. The share of coins remaining unmoved for over a year reached a record of 69%.



Despite a price increase of 82% in 2023, the realised value (profit + loss) is only $290 million daily. This is the indicator of 2019 and 2020, showing low activity and investor unwillingness to part with coins at current prices.



Institutional investors

Institutional investors represent a group of the most cautious participants, relying on macroeconomic trends and the Fed's monetary policy. Expectations of the latter's reversal due to lower inflation in the US led to an increase in investments in crypto ETFs. Over the past four weeks, an inflow of $742 million was recorded, an amount not seen since Q4 2021. 95% of it is due to interest in Bitcoin.



In a recent interview, Laurence D. Fink, Chairman and Chief Executive Officer of BlackRock, said that cryptocurrencies would eventually surpass any national currency in valuation due to their international nature.


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Which altcoin will take off in the next 12 months?

After XRP's (Ripple) spectacular 140% triumph in 2023, investors are wondering which other altcoin has the potential to pop off in the next 12 months. CryptoVantage surveyed 1000 US residents who had experience buying cryptocurrency.

70% of respondents expect new historical highs to be reached in five years. Ethereum has the best chance of surpassing Bitcoin, with Dogecoin in second place. 16% of respondents said that no altcoin has a chance of overtaking Bitcoin in terms of market capitalisation.



In terms of capitalisation, Ethereum ($229 billion) is way closer to Bitcoin ($586 billion) than to other altcoins. Excluding stablecoins, the next one is XRP, with $44 billion and the above-mentioned Dogecoin, with just $10 billion.

But Ethereum's strength lies not only in its army of fans but also in the developers' never-ending efforts to modernise the network. Last year, the network switched to the PoS algorithm, turning away from miners' services. Energy consumption has been reduced by 99%.

Instead of miners, validators are now responsible for block building. The opportunity for passive income has led to a boom in investment demand. As a result, 9,000,000 ETH worth $17 billion were staked in the last 12 months.



Even the SEC's enforcement action against US cryptocurrency exchanges and the refusal of some of them to participate in the staking programme couldn't affect the inflow of funds.

The survey also included this point, with only 20% of respondents believing that tighter crypto regulation would hurt the future value of cryptocurrencies.



In addition to the interest in staking, Ethereum's exchange rate is positively impacted by supply reduction due to the burn mechanism introduced by the London hardfork back in 2021. In 2022, the network switched to PoS and became deflationary; 294,000 ETH worth $562 million was burned after the merge.



The only factor holding back Ethereum's growth remains the regulator's hawkish stance. But its recent court loss to Ripple on some points and the judge's refusal to recognise cryptocurrency trading as securities transactions increase Ethereum's chances of deflecting the SEC's attacks.


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Cathie Wood confirms $1.5 million forecast for Bitcoin

In a forecast case study released in February, Ark Invest presented three scenarios for the cryptocurrency market until 2030. The bearish one suggests Bitcoin will rise to just $260,000, while the bullish one foresees a surge to $1.5 million. In an interview with Bloomberg this week, Cathie Wood said the team's confidence in the bullish scenario has increased.



Wood believes Bitcoin will continue to establish itself as an insurance option against inflation and that "everyone will want it at the end of the day." Cryptocurrency protects wealth from outright confiscation, inflation, and the risk of loss to third parties (counterparties) when stored or transferred. With the adoption of cryptocurrencies and the regulatory and legal framework in place, interest in Bitcoin will grow exponentially.

The SEC being flooded with applications to launch Bitcoin ETFs clearly indicates the same. Ark Invest teamed up with 21Shares and applied documents ahead of investment giant BlackRock. The SEC has accepted this and other submissions, as indicated in the public records note. A decision is due on 13 August, but the regulator can push the deadline forward.

Some experts agree that BlackRock's participation increases the chances of a positive outcome. Existing cryptocurrency funds have already experienced an influx of capital from institutional investors not seen since Q4 2021, with over $700 million invested in Bitcoin in four weeks.



Major participants expect a rally after the first Bitcoin spot ETFs appear in the US.



When it comes to price targets, the $1.5 million forecast from Cathie Wood fits well with Bitcoin's four-year cycle model.



In the current cycle, with a record in 2026, Bitcoin will reach a maximum in the range of $100,000 to $1 million. And in the next cycle, with a peak in 2030, the price will range from $1 million to $10 million.

It's unknown whether the Ark Invest team was guided by the theory of cycles. Potential investors should consider that forecasts and mathematical models give only a conditional idea of future changes.


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Whales are dumping Bitcoin onto exchanges at a record pace

As the market sees long-term growth, whales are selling off their stocks to lock in profits and reduce their holdings. Typically, large periods of contraction coincide with price appreciation cycles. However, Bitcoin's performance in 2021-2023 has been a significant departure from the trend. During that time, it's traded at half its record high, and whales continue to get rid of their coins.



Over the past month, whales have been dumping Bitcoin at a record-high pace for 2023, adding an average of 16,300 BTC per day into the market. At the same time, the share of whales in the total inflow to exchange sites reached 41%. This exceeds even the stressful circumstances of last year, such as the collapse of the Terra project (when whales' share was 39%) and FTX's bankruptcy (33%).



Whales' actions may be driven by some insider information, but they're more likely driven by a reaction to the growing risks posed by the tightening of crypto regulation in the US and the prosecution of US market participants.

Notably, in July, 82% of all whale inflows to crypto exchanges have gone to Binance. Coinbase is in second place with a modest 6.8&. All other sites have taken in a combined 11.2%.



The whales' actions have resulted in Bitcoin not only failing to gain a foothold above $30,000 but also showing a decline in recent days.



It's worth mentioning separately that there is no unanimity within the whale cohort. For example, humpback whales (1,000 –10,000 BTC) were actively accumulating coins in July, while blue whales (>10,000 BTC) were getting rid of them.



Other market participants have taken a wait-and-see approach. Their aggregate exchanges don't show any significant change in their holdings.


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Elon Musk's launch of X.com will result in a Dogecoin rally

Musk's acquisition of Twitter is part of a bigger plan to create a global social platform with a broad integration of financial features. And he isn't hiding his inspiration from the Chinese WeChat, where users can communicate, place orders, transfer money, play and send official requests to government bodies.

For his new creation, Musk bought rights to the X.com domain in 2017. For now, this website is redirecting to Twitter, but later, the usual address will be gone for good, as it already happened with its name.

"The Twitter name made sense when it was just 140-character messages going back and forth - like birds tweeting. But now you can post almost anything, including several hours of video," Musk said, explaining the rebranding.

The bird logo was unexpectedly changed to X on 24 July. On the same day, users noted a change in Musk's bio, where the X was accompanied by the Dogecoin sign Ɖ.



Musk has long been known as a cryptocurrency lover. In 2021, it became possible to pay for Tesla vehicles using Bitcoin. However, under the pretext of environmentalism, this ability was rolled back two months later. After that, Musk dedicated all of his attention to Dogecoin, being called Dogefather for his regular mentions of this cryptocurrency.

On 3 April 2023, this love reached new highs when the Shiba-inu image, the cryptocurrency's symbol, shortly replaced the Twitter logo. Musk explained the replacement as a fulfilment of an earlier promise he made if he were to buy the social media company.



Increased interest in Dogecoin and anticipation of the upcoming changes have led to a 17% increase in Dogecoin's price in the past seven days. The majority of other coins have seen a decline in this period of time.



But there's still more upward movement ahead. Users have reason to believe that Dogecoin will get a leading role in X.com due to Musk's sympathy for the coin. The reason is not just about being a crypto-cutie or respecting community cohesion. Real Vision CEO Raoul Pal believes Dogecoin will allow Musk to bypass securities laws and use the cryptocurrency to make global payments.



Following Musk's statements, the new X.com's features will be rolled out in the upcoming months. "If done right, X would become half of the global financial system." If Dogecoin gets a leading part in the payment segment, it will result in a rally for the cryptocurrency.


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Liquid staking pushing Ethereum

The Proof-of-Stake (PoS) algorithm has provided Ethereum holders with a passive income opportunity. The growing interest in staking has been slowed by the 32 ETH ($60,000) limit required to deploy one's own node. Many experts have criticised the owning limit, but liquidity pool platforms have come to users' rescue.

First, liquidity pools provide almost the same amount of profit as staking does. This amounts to a 4.3% annual return, but because of the growing network load, it may even reach higher numbers, as was the case in May.



Second, when staking ETH, platforms issue their tokens in return, which are called liquid staking derivatives or LSDs. These 'coupons' can be exchanged for ETH at any time or be traded or used in third-party staking programmes. This allows seasoned users to get the most profits when compared to regular ETH staking.

As of now, the staked amount is 27.6 million ETH, which is currently worth $51.4 billion, with 10.7 million ETH or 30% accounting for LSD.



Most analysts are of the opinion that LSD will soon exceed the share of funds directly participating in staking. On the one hand, this is a positive trend that illustrates the resumption of interest in the DeFi sector after the collapse of a series of projects in 2022. Without Ethereum staking pools, it would be difficult to attract investors with such a higher barrier to entry.



On the other hand, projects' interdependence is once again rising, which could lead to a chain reaction if one of them crashes. The risks are especially acute due to the dominance of Lido Finance, which holds a 74% share of the LSD market.



Last year, the STETH 'coupon' from Lido was already trading at a significant discount to ETH, which was caused by users' massive sell-off.



Right now, the market is rising, and the crisis is fading into the background. However, similar situations could occur again in the future. Investors aiming to maximise their profit should bear these risks in mind.


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Bitcoin risks a strong decline amid the DeFi crisis

The high interdependence of projects and cross-lending is once again hurting the entire cryptocurrency market. This time, a vulnerability in early versions of the Vyper programming language led to the theft of funds from several exchange pools on the Curve Finance platform. To make matters worse, its potential collapse could drag other DeFi players down with it.

Vyper is a programming language designed for the Ethereum Virtual Machine (EVM). It's used to write the smart contracts on which decentralised exchanges (DEX) operate. DEXs allow for exchanges between cryptocurrencies and passive income from lending.

On 30 July, Curve Finance faced the breach of liquidity pools in CRV/ETH, alETH/ETH, msETH/ETH and pETH/ETH pairs, which used earlier instances of Vyper, versions 0.2.15 to 0.3.0. Another over 200 pools weren't affected.



While losses are still being counted, leaks on the following pools have been identified:

- CRV/ETH - Curve - $22 million
- alETH/ETH - Alchemix - $13.6 million
- pETH/ETH - PEGd - $11.4 million
- msETH/ETH - Metronome - $1.6 million

The hack led to panic among participants, with a 50% outflow from the platform and its total value locked in (TVL) dropping to $1.6 billion.



The fact that the crisis has the potential to spill over to other platforms is making matters even worse. Curve CEO Michael Egorov borrowed $63 million worth of stablecoins on the Aave platform secured by CRV (Curve). Over the past two days, the CRV has fallen 30% to $0.51. When the price reaches $0.37, Egorov's position will be forced closed, and Aave will flood the market with 168 million CRV coins.



The problem for Aave is that they won't be able to sell all coins, which represent 34% of their total circulating supply, at current prices at the time of liquidation. Selling off even a portion of the position would inevitably lead to a further fall in CRV and more panic in the DeFi sector.

Behind the scenes, platform executives are trying to find a solution, while Egorov is selling off stockpiles of other coins to increase its collateral. The community is puzzled as to why Aave accepted such a substantial amount for a loan and failed to consider the obvious systemic risk.



Amid the news, Bitcoin has lost some 1.5%, but the decline could get worse, given the Aave and Curve crisis will get out of hand. The DeFi sector is reacting by declining 8.2% to $40.2 billion.


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93% of hedge funds expect the crypto market to grow by late 2023

PwC, the world's second-largest consulting firm, surveyed both cryptocurrency and traditional hedge funds. And their managers agree on most of the key points. We've selected the most interesting takes from the survey.

When working with cryptocurrencies, hedge funds pay special attention to security. Most players use third-party services to store their holdings or manage cold wallets independently. Cryptocurrency exchange accounts are primarily used to execute transactions directly or to hold open positions in derivatives.



The events of 2022 have forced managers to rethink their market behaviour strategy, including mitigating the associated risks. Therefore, spot trading is leading by a significant margin in 2023.



But don't perceive hedge funds as rookie players who bought Bitcoin to hoard it. On the contrary, many of them (especially crypto hedge funds) use various opportunities, including loan programmes from decentralised exchanges (DEXs). The same managers who don't work with DEXs cited regulatory restrictions and cybersecurity risks as the reasons why they don't.



Bitcoin and Ethereum are the preferred cryptocurrencies because of the events of 2022. 48% of hedge funds claimed they were directly affected by the collapse of Terra (LUNA) and FTX. This was the reason behind this year's decreasing interest in altcoins. But 93% of those surveyed think that the bottom has formed and that the cryptocurrency market will see upward movement in late 2023.



But don't forget the long-standing confrontation between Bitcoin and Ethereum.



72% believe that Ethereum has zero chance of ever surpassing Bitcoin in terms of market cap.



The 28% of respondents who believe in the altcoin expect Ethereum to achieve superiority in the next 2 to 5 years.


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Curve offered hacker 10% to return $70 million

On 30 July, Curve Finance experienced a hack that could lead to a chain reaction in DeFi. In a week, the outflow of funds from various lending programmes has reached $2.7 billion.



Because CRV/ETH, alETH/ETH, msETH/ETH and pETH/ET used the earlier versions of the Vyper programming language, the hacker managed to steal around $70 million. It wouldn't be that big of an amount compared to the annual hacking losses of various projects if it weren't for the drop in CRV's value and its use by Curve Finance CEO Michael Egorov as collateral on Aave for a loan.

CRV's drop to $0.37 will cause forced closure of the position. This will be a headache for Aave, as the 168 million CRV coins represent a third of its circulating supply. It's impossible to sell such volume without significant slippage, which brings systemic risks for Aave and other related platforms. This caused the AAVE token to lose 14% of its value.



To avoid the worst-case scenario, Egorov held a private sale that raised $16 million for 39 million CRV. The premium for buyers amounted to 25% of the market rate. Curve has also addressed the hacker, offering a 10% reward for returning the stolen coins.



The company is offering the hacker to return 90% of the stolen coins by 6 August with a promise not to take any legal actions against them in return. If no funds are returned by the set date, Curve will provide a 10% reward of the stolen amount to those who help identify the thief. As of now, it's around $7 million.

ZachXBT, among other crypto detectives, claim they have contacted a potential suspect. The latter, however, countered that they themselves were victims of the hack and asked ZachXBT to edit the post.



Returning some of the stolen goods in exchange for non-prosecution is a fairly common practice for the cryptocurrency market. Hackers happen to return the full amount, as some of them prefer the process itself, and there's a non-zero chance of identification, even with the most sophisticated theft methods.

Yesterday, Ilya Lichtenstein, who was charged with laundering funds stolen from Bitfinex in 2016, pleaded guilty to hacking. After infiltrating the cryptocurrency exchange's network, Liechtenstein conducted over 2,000 transactions and embezzled 119,754 BTC. Currently, that's worth $3.5 billion.


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Curve Finance hacker agrees to a deal

Last week, we covered the hack of the Curve decentralised exchange and the risk that put the entire DeFi sector in due to cross-lending. For a quick resolution, the hacker was offered a 10% reward and a waiver of legal claims for returning the stolen $70 million by 6 August. Otherwise, the Curve team promised this amount as a reward to others for identifying the hacker.

One of the Curve pools affected by the hack, the JPEG'd project, has already confirmed the return of the stolen 5494.4 WETH (~$10 million). JPEG'd said it considers the event to be a resolution and is ending its search for the hacker. The project is providing a reward of 610.6 WETH (~$1.1 million).



The Alchemix project, which lost $13.6 million due to the attack, is also reporting the full return of funds.



On the back of positive conflict resolution, the crvUSD stablecoin has returned to parity with USDT, with the DeFi sector seeing blockchain coins rise 2% to $40.9 billion. The AAVE token recovers as the risk of liquidating the credit position of Curve CEO Michael Egorov, who borrowed $63 million worth of stablecoins from AAVE under CRV, fades away.



Traders who were expecting a Curve rout are pulling back as the funding rate has returned to neutral. This indicates that there's no longer a dominance of sellers in futures contract trading.



Unfortunately, not all crypto hacking stories have a happy ending.



According to Certik, there were $313.6 million in thefts in Q2 2023 alone. Less than half of those funds were returned, with most cases remaining unsolved.


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Bitcoin: The current consolidation is in line with previous cycles

Bitcoin's 1-12 months of volatility is at the lowest point since 2016. In the history of cryptocurrency, which is characterised by large price swings, only a few months have been calmer.



Following the decline in volatility, trading volumes in the derivatives market also dropped. Bitcoin's total volume fell to $19 billion daily, while Ethereum's dropped to $9.2 billion.



This calm will eventually result in a major price move, but it's not in any way an extraordinary event. After reaching highs during the 2021 rally and 842 days after, the current drawdown is 54% lower.

Note: Glassnode takes April 2021 rather than November as the starting point for the last cycle. According to the agency, the bears started taking control in May 2021.



These numbers are way better than in 2019 (64%) or 2016 (63%). It's also worth noting that in previous cycles, the price was very slow to rise in the six months before the new bull run. So, the current volatility drop is typical for a recovery period and may continue.



Anticipation of a sideways move correlates well with the Fed's monetary policy. The regulator will probably not raise its key rate again and plans to gradually retreat by 1% or more from current levels (5.5%) in 2024.



However, market turbulence, the US dollar's devaluation and positive changes for Bitcoin are still possible in 2023. For instance, the regulator can do a 180 way earlier due to a continuing banking crisis. Last week, Heartland Tri-State Bank shut down. It was the fifth American bank in 2023 that couldn't meet modern challenges.

Authorisation to launch Bitcoin spot ETFs may be the second driver. Anticipating victory, the SEC has been flooded with applications for Ethereum spot ETFs. Market participants consider the chances to be high since BlackRock, the world's largest investment company by assets under management, is also involved.


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Traders bet on SAND declining after $134 million unlock

The gaming segment of the crypto market has seen better days. Sales are down 90% compared to the best months of 2022. Sector investments have also experienced a decline and are now performing worse in terms of the number of new jobs.



The situation for users of the Sandbox metaverse is complicated by the upcoming release of 333 million SANDs worth a total of $134 million. The new coins are set to be distributed among users on 14 August.



30% will be directed to the company's reserve to hold events, 32% will go to the project's team and consultants, and the rest will be credited to early investors and participants in previous promotions. Excluding the reserve, 236 million SANDs worth $94.4 million may be released immediately.

The previous unlock was held in February and resulted in a consequent price decline, completely offsetting January's growth. SAND has lost half its value from its February highs.



In anticipation of another unlock and price decline, traders of perpetual futures are increasing their sell positions. This has put the funding rate at its lowest point in five months.



Over the past 12 months, the volume of the platform's daily operations declined by 4.6 times to $132,000. And the number of unique addresses dropped thrice to 201. Rare activity bursts are seen during the events when additional NFT artefacts add value to rewards. Often, such investments are unjustified because of the drop in SAND's price and the time spent on tasks.



With these inputs, an increase in circulating supply is likely to cause SAND's price to fall further.


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Low Volatility Period For Top Cryptos As Meme Coins Gain

Monday was a quiet day for major cryptos, including Bitcoin (BTC) and Ethereum (ETH), which saw only lacklustre market action over the weekend in what emerged as one of the lowest volatility periods in crypto history.



Bitcoin is holding out at just over $29,300 as Ethereum hovers around the $1,850 mark, with minimal gains for investors in the absence of any major events that could serve as a catalyst to spark buying pressure. Other major cryptocurrencies and mid-tier altcoins, such as Cardano (ADA) and Solana (SOL), tended to follow Bitcoin's pattern.

Given the lack of action in the crypto mainstream, it's perhaps unsurprising that traders turned to meme coins such as Shiba Inu (SHIB) and Pepe (PEPE), which both rallied over the weekend. In particular, open interest in SHIB futures reached record highs.



Historically, this kind of action on speculative assets on the fringes of the crypto market could be a sign of bullish action to come in the wider digital asset space as the market heats up before a price breakout at the top.

What's next for crypto?

As low volatility reigns, analysts are projecting what will be the next event to dramatically shift the market. An anticipated ruling on Bitcoin ETFs from US regulators is expected to inject volatility back into the market, but lawmakers appear to be dragging their feet on the issue.

Bitcoin also faces another looming event that has historically driven up prices, and this one is irrevocably built into the blockchain in the form of its next halving of mining rewards, scheduled for April 2024. Analysts expect an accumulation of BTC before the upcoming halving event introduces even more scarcity. This is supported by the latest data from Glassnode, which shows that the total number of Bitcoin addresses with a balance of at least 1,000 BTC (the equivalent of over $29 million) has gone up from 2,005 to 2,015 since the start of August. Pundits point to these new whales as a sign of bullish momentum brewing under the surface.


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What Are We Waiting For? Why Bitcoin Isn't Moving Yet

Bitcoin (BTC) continues to tread water below the $30,000 line, dragging down a host of altcoins with it as Dogecoin (DOGE), Solana (SOL) and Polygon (MATIC) all fell by 6-7% midweek. The malaise remains in place even as data shows an uptick in BTC accumulation because the market has yet to make any major moves. So the question is, what is the next trigger that could spark some action in this stagnant market? Let's analyse a few factors.



The SEC reviews Bitcoin ETFs

The US Securities and Exchange Commission (SEC) is still stalling on a review of multiple spot BTC ETF applications, including one from finance titan BlackRock. Plenty of crypto pundits are bullish on Bitcoin's prospects if these ETFs are approved. Fundstrat Global Advisors' Tom Lee dropped a characteristically bombastic prediction of $180,000 during a CNBC appearance this week. While this prediction should be taken with a pinch of salt, more analysts expect that the SEC's approval of spot BTC ETFs would drive up demand for Bitcoin and increase prices.

Investor sentiment

Looking at the futures market, we can see that the trend of short Bitcoin liquidations that had dominated since the start of the year has now reversed. Now, 83% of all BTC liquidations are long positions, and Bitcoin trading volume sits at its lowest level in over two years. Without any buying pressure from trading volume, the dominance of long liquidations is keeping asset prices down.



Macroeconomic events

Bitcoin traders have been keeping an eye on the global economy lately as BTC's price continues to be directly affected by inflation, as indicated by the consumer price index (CPI) figures and the actions of the US Federal Reserve. Last week's CPI surprised analysts by being lower than usual, suggesting that the Fed may slow its interest rate hikes and even start cutting rates to stimulate the economy. If this occurs, then Bitcoin and the wider crypto market could benefit from renewed investor interest.

Despite the mid-August slump and overall low volatility, general market sentiment still expects a recovery and breakout for Bitcoin as mainstream financial institutions continue to adopt crypto and the 2024 halving event looms on the horizon.


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