Cryptocurrencies were seeing a stagnation phase during the last few days after their latest rebound.
While the crypto market as a whole recorded a mitigated performance during the last few months, bitcoin has been able to maintain a constant uptrend since the beginning of the year.
The largest cryptocurrency has benefitted from the various developments in the crypto and traditional markets lately.
Denys Peleshok, Head of Asia at CPT Markets said, “In this regard, bitcoin’s dominance over the market has been growing steadily, reaching above the 50% mark, dwarfing other major cryptocurrencies.
“Investors have been moving toward bitcoin with each financial and confidence shock. Bitcoin has benefitted from the US banking confidence crisis earlier this year and the SEC’s lawsuits as well as the enthusiasm around the potential launch of a bitcoin ETF.
“Bitcoin ETF applications have supported investors’ sentiment as institutional and retail investors could show increasing interest in the market through such investment vehicles. If the SEC approves new applications, the market could record a surge in demand and in the number of buyers.
“In addition, due to the SEC’s legal stance over cryptocurrencies, the market could further concentrate on bitcoin and Ethereum, the two largest assets in the market.
“The legal uncertainty could be beneficial for bitcoin in general but could push market participants toward more caution and fuel more risk aversion in the crypto market.
“However, the market could continue to see some risks from the increasing interest rates in major Western economies with central banks continuing to fight inflation.
“Expectations of higher interest rates could fuel risk aversion while investors could move to high-yield and risk-free assets. At the same time, the resulting economic risks could also affect investors’ approach.”