After enduring a turbulent year in 2022, investor sentiment toward cryptocurrencies has taken a positive turn in 2023. With improving economic circumstances, crypto assets are once again attracting investor interest and optimism.
This trend has been particularly evident in more recent weeks after a series of applications for spot Bitcoin exchange-traded fund (ETF) raised hopes that the world’s leading cryptocurrency could finally witness mainstream acceptance among institutional investors.
In line with this, crypto investors have been shifting their holdings from stablecoins into Bitcoin (BTC) and Ethereum (ETH), suggesting that market participants are growing hungrier for riskier assets such as cryptocurrencies, crypto expert Ali Martinez noted on July 12.
“Crypto investors are shifting from stablecoins into Bitcoin and Ethereum. A decrease in stablecoin holdings points to a higher risk appetite among investors as they move their capital to BTC and ETH.”
Increased interest and holdings in Bitcoin and Ethereum are likely to have a noteworthy impact on their respective prices highlighted by the aggravated market realized value net position change. As more investors enter the market and acquire these cryptocurrencies, the demand for them will rise, potentially driving up their prices.
At the same time, Bitcoin fund holdings have also increased significantly recently, particularly after BlackRock applied for a spot BTC ETF in mid-June. Specifically, the number of BTC held by funds jumped to almost 850,000 – the highest level in 6 months.
At the time of writing, the price of Bitcoin was standing at $30,680, up around 0.95% in the past 24 hours.
The largest cryptocurrency gained more than 18% over the past month amid institutional crypto hype, adding almost $100 billion in market cap over that period.
Year-to-date, BTC is up around 85%, marking an impressive rebound following a disastrous crypto winter last year.
Meanwhile, Bitcoin’s price momentum oscillator (PMO), a significant technical indicator, has finally turned green after a certain time period, just like it did in 2014/15 prior to a major bull run that led to an all-time high later on.
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