Bank of America’s recent report revealed a number of positive indicators from the cryptocurrency market. The US banking giant expects big moves in Bitcoin and 2 altcoins.
Bank of America says crypto market is gaining bullish momentum
According to BoA, the recent surge in net inflows and outflows of stablecoins from exchanges points to “bullish” momentum. In the July issue of its “Global Cryptocurrencies and Digital Assets” report, the bank argues that “fading selling pressure” has now turned into “buying”. The other indicator that strengthened the bull expectations was the market’s rapid recovery of up to 11%, despite the 56% drop between June 29 and July 26. The cryptocurrency market has regained its total volume of $1 trillion in this process.
Even more surprising is that the latest increase in prices occurred after the Fed’s rate decisions. The Fed increased the policy rate by 75 basis points to 2.25-2.50% at its meeting on 27 July. Despite this, investors have managed to adjust to recent macroeconomic volatility, according to Bank of America.
Investors secure these cryptos
Bitcoin, Ethereum, and FTX (FTT) have been the cryptocurrencies that investors have drawn from exchanges to wallets. Investors usually only withdraw the cryptos they trust from exchanges to their wallets.
For example, when we looked at Bitcoin over the past month, foreign exchange outflows amounted to $508 million. During that time, Bitcoin rose +19% from $19,300 on July 2 to $23,160 on August 1. Similarly, Ethereum saw a net inflow of $381 million, up more than 56%. The top four stablecoins by market cap, USDT, USDC, BUSD and DAI, saw a total of $1.4 billion in net inflows for three consecutive weeks.
Unlike their entry into volatile cryptos such as Bitcoin or Ethereum, stablecoin entry into exchanges is interpreted positively. This is because the entry of dollar-pegged tokens signals the entry of buyers into the market.
BoA sees bullish signals in Bitcoin and these 2 altcoins
However, when investors want to increase their risk appetite, they often try to use stablecoins to invest in more lucrative cryptocurrencies. The chart below, provided by Bank of America, shows that investments are using the most USDT.
According to on-chain data from Glassnode, Bitcoin buyers include both long-term and short-term assets. Short-term investors in particular have become fond of Bitcoin over the previous two weeks. According to the bank, this has developed an appetite for Bitcoin, which indicates that the “bullish” momentum may be short-lived.
cryptocoin.comAs you follow, Bitcoin price has remained above $23,000 since July 27.
