As last week drew to an end, the crypto market finally turned green again as its locomotive, Bitcoin price, reversed and began to grow. Following the pioneer cryptocurrency, everything began to rise – Ethereum, Binance Coin, Solana, XRP – the whole top ten list and a lot of major altcoins beyond it.
Now that Bitcoin has resumed its ascend, traders and investors are hoping that the major correction seen by BTC after the halving is finally over and they will now be able to see their profits skyrocket.
Bitcoin resumes growth despite recent negative drivers
On Friday, market participants were shocked to see positive inflows into the Grayscale’s GBTC spot Bitcoin ETF for the first time in its history. The US regulatory body SEC spearheaded by Gary Gensler approved spot Bitcoin ETFs in mid-January after many months of tense waiting on behalf of the applicants – among them were such finance management behemoths as BlackRock (the world’s largest wealth manager), Ark Invest, Bitwise, VanEck, Grayscale – eleven ETFs all-in-all got the green light from the regulator. GBTC was converted from a Bitcoin Trust that Grayscale operated prior to that step.
From the very start, ETFs began to see massive inflows as they suck up approximately 12x BTC produced by miners per day. Before the Bitcoin halving which occurred in the second half of April, the amount of Bitcoin extracted by miners daily totaled roughly 900 BTC with block rewards sitting at 6.25 BTC. At that time, the ETFs consumed roughly 10,000 BTC on a daily basis.
That was true about all the ETFs, except for Grayscale’s GBTC – it kept facing huge outflows since this fund’s fees were much higher than those of the others. These negative inflows comprise $17.4 billion in Bitcoin.
However, on Friday, for the first time, $36 million went into GBTC. On May 6, another 979 BTC flowed in worth $62.14 million. In total, this ETF currently holds 292,218 BTC – the equivalent of an impressive $18.55 billion.
This was the first positive event for the market over the past couple of weeks and it propelled Bitcoin roughly 10% up over the weekend. The leading global crypto surged from $59,000 to $64,450 on Saturday. By Sunday, Bitcoin was sitting at $65,220, completing the 10% increase.
By now the primary cryptocurrency has staged a decline of 2.20%, sinking to the $63,760 price mark.
Altcoins growing along with BTC
Traders started buying Bitcoin and altcoins. According to an analytics report by Santiment, the number of non-zero BTC wallets has reached an all-time high of 54 million, showing a 10% growth. Ethereum non-empty wallets spiked to a peak of 120.7 million wallets, showing an 11% rise.
So have DOGE, XRP, USDT, USDC and TON wallets with only ADA demonstrating zero growth. The TON network has been expanding the fastest here. The increase of non-zero wallets has been astonishing +110% as it climbed to 16,800 wallets.
As for Ethereum, it saw 266,600 new wallets created at the very end of April. Speaking of top altcoins, within the last week, ETH has jumped by 2.41%, Binance Coin (BNB) has spiked by 4.83%, Solana has increased by a whopping 23%, showing the largest price surge among the top-10 coins.
XRP has added 8.71%, Dogecoin and Toncoin have gained 16.5% and 15.9%, correspondingly. The crypto price data has been provided by CoinMarketCap.
Historically, altcoins almost all the time rally following any powerful increase of Bitcoin. The world’s largest cryptocurrency was still in a correction last week after several impactful bearing factors.
The two largest ones among them was the Binance founder Changpeng Zhao (commonly known as CZ) going to jail for four months and the Fed Reserve opting for leaving the bank interest rate at the current level, contrary to the previous lavish hints spread by its chairman Jerome Powell that the Fed is now ready to switch to a loosening policy and begin cutting the rates down.
Bitcoin halving as major catalyst of further market rally
Bitcoin halving which occurred in April was the hotly-anticipated event within the crypto space. BTC runs on the proof-of-work consensus algorithm, so every four years it goes through the process of deflation – block rewards get slashed by half. This allows BTC to become more scarce and ensure that Bitcoin miners can remain in business for many years to come.
This year, the crypto community witnessed the fourth Bitcoin halving with block rewards dropping from 6.25 BTC to 3.125 BTC. The overall amount of BTC mined in one day also decreased in half, declining from 900 to 450 BTC.
Investor and Bitcoin expert Anthony Pompliano has recently said in an interview that the Bitcoin halving price action has gone more or less as expected. Historically, he said, BTC runs about 19% a month before the halving and it goes only roughly 1-2% within a month after the halving.
Now, many experts believe that Bitcoin is likely to continue its hike and so odds are high that altcoins may follow suit.
