Bitcoin’s price is at its highest since June of 2022, and ether and cryptocurrency-related stocks like Coinbase have rallied. A crypto custody platform is expected to be launched by Nasdaq shortly as traditional financial firms explore entry into the crypto world. Crypto community members are still dealing with the consequences of a rough year in 2022, which saw the collapse of trusted firms like FTX and interest rates spike, weighing on financial asset prices.
Are crypto prices poised to continue to rise into the final quarter of the year? Moreover, you can also trade crypto using your trading platforms like BGX AI by following their sign-up scheme and get the best outcome of your trading.
Bank Collapses and its impact on Crypto
Since the start of 2023, bitcoin has rallied around 80%, exceeding the $30k price mark once again. Crypto industry observers predict that Bitcoin could test its all-time highs this year. CNBC recently quoted Marshall Beard, CEO of cryptocurrency exchange Gemini, as saying Bitcoin could reach $100,000 per coin. There are others who are less convinced due to factors like the recent string of bank failures that have put pressure on cryptocurrencies.
Interest rates play an important role in determining the outlook for crypto, just as they do for stocks and bonds. Fed interest rates have been raised to curb inflation, making borrowing money more expensive. A negative effect of this is felt by speculative assets, such as cryptos. According to a recent report from Bank of America, cryptocurrency may suffer from rate increases in the coming year.
Regulation and Adoption of Crypto Continue
It’s still a fact that major institutions are adopting crypto despite its challenges, they say, adding legitimacy to the asset class. As an example, Nasdaq, a significant exchange, plans to offer crypto custody services (CCS) by the end of the last quarter, depending on regulatory approval. Almost all of Fidelity’s retail accounts are now able to trade crypto following the expansion of the company’s crypto trading services.
Crypto investors also continue to be concerned about regulation. The SEC recently warned crypto platform Coinbase that it might be violating U.S. law regarding some of its crypto products. This is just the latest example of the SEC cracking down on cryptocurrency. While crypto investors polarize on regulation, many experts argue that it is beneficial to the crypto industry in the long run, as it reduces investor risk and stimulates capital inflows.
Crypto’s Momentum could be Sustained by Seasonality
It is impossible to predict how cryptos will perform in the future, but seasonal trends can give us an indication of how cryptos may perform during the next few months. A recent study suggests April is an excellent month for crypto price growth. A decade-long analysis of Bitcoin returns found that the cryptocurrency returned 17% in April.
There has been a more significant correlation between crypto and the stock market in recent years. This was evident throughout the first quarter of the year, as cryptocurrency’s rally paralleled a rally in stocks. The stock market has historically performed well in April and is expected to increase in the upcoming months.