Crypto Market Cap Poised For Breakout: Analyst Predict 23% Upside Potential
The crypto market has been on a rollercoaster this year, with prices fluctuating wildly and regulatory pressures causing significant drops. However, recent developments have given investors renewed confidence in the market, leading to a total crypto market cap recovery.
On June 15th, the total crypto market cap hit a low point of $972 billion, following the Securities and Exchange Commission’s (SEC) regulatory pressure on the industry. But since then, the market has rebounded.
This recovery has been driven partly by the entrance of major financial players into the crypto space. Several applications for a Bitcoin Spot Exchange-Traded Fund (ETF) by major financial players such as Blackrock and Fidelity have been filed, indicating that they are interested in betting on cryptocurrencies.
This has helped to rebuild investor confidence in the market, leading to increased investments and a rise in the total crypto market cap.
Crypto Market Cap’s Moment Of Truth
Cryptocurrency investors are closely monitoring the total crypto market cap as it attempts to break through a significant resistance level. According to crypto analyst Rekt Capital, if the market can successfully breach this level, it could pave the way for continued upward momentum and potentially significant gains for the overall market.
At the time of writing, the total crypto market cap is around $1.17 trillion, with Bitcoin making up the lion’s share of this value. However, the market has been trading in a relatively tight range over the past few weeks, with many investors looking for a catalyst to drive prices higher.
Rekt Capital believes that a breakout above the current resistance level could be just the catalyst that the market needs to see a sustained uptrend. Rekt Capital suggests that the market could see gains of between 10% and 23% over time if this breakout occurs.
As depicted in the chart, the immediate resistance levels for the global market cap of the cryptocurrency industry are currently at $1.18 and $1.25. The latter represents the highest level achieved in 2023.
However, certain conditions must be met for the market to break through these levels. Firstly, there needs to be an improvement in current market conditions, including a relaxation of crypto regulations by regulators globally, particularly in the US. Additionally, there needs to be a resolution of the ongoing Bitcoin Spot ETF applications by major financial players with the SEC.
If these conditions are met, it could lead to an influx of financial players and investors into cryptocurrency. Many investors are looking to cryptocurrencies as a hedge against inflation, and greater regulatory clarity and the approval of a Bitcoin ETF could make the industry more attractive to traditional investors.
Cryptocurrency Trading Volume Drops To 2020 Levels
Crypto trading volumes have reached their lowest levels since 2020, despite the ongoing rally in June. According to a report by crypto market data provider Kaiko, spot trade volumes have significantly declined in Q2, with Binance registering the strongest drop in trading activity.
Binance, one of the world’s largest crypto exchanges, saw volumes fall by nearly 70% after the exchange reintroduced fees for its most liquid Bitcoin pairs. This move, aimed at reducing market manipulation, appears to have significantly impacted trading activity on the platform.
However, Binance was not the only exchange to see a significant decline in trading volumes. Other popular exchanges, including Coinbase, Kraken, OKX, and Huobi, also saw volumes decline by over 50% in Q2.
The decline in trading volumes is surprising, given the recent rally in the crypto market. Bitcoin, the largest cryptocurrency by market cap, has been bullish in June, reaching a high of over $31,000. Despite this, trading volumes have remained subdued, suggesting that investors are not as active in the market as they have been.
Featured image from Unsplash, chart from TradingView.com
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