Why is the rise and fall of Bitcoin so fast (Why does Bitcoin keep rising but still lose money)

Why is the rise and fall of Bitcoin so fast? Let’s take a look at the trend chart of Bitcoin, as shown below.

From historical data, BTC has fallen more than 30% since the end of last December, and then continued to rise to the current price near $60,000, with a drop of over 50% in the past 24 hours. This means that there has been a huge change in market sentiment.

According to statistical data, the total market value of cryptocurrencies increased by about $400 million from February 1 to March 31, 2020 (average for the first three quarters of 2021), reaching the highest point in nearly 30 years. (Note: Total market value is an indicator of measuring the value of an asset class or industry)

Why does Bitcoin keep rising but still lose money

Editor’s note: This article is from the Fenghuolun Community (ID: FHBT18), author: Peipei, and authorized reproduction from Odaily Planet Daily.

Hello everyone, I’m Xiaoxi, and I’m glad to tell you that my recent analysis is about the meaning of “the cryptocurrency market keeps rising”. Today, we will discuss the outlook for Bitcoin’s recent trends and its volatility changes.

Recently, I saw a news in the cryptocurrency market:

1. According to Coindesk, cryptocurrency trading platform Kraken is considering offering new products and services based on Bitcoin to users through its subsidiary, including Bitcoin custody services and exchange-traded notes. In addition, Coinbase also revealed their plan to launch a new digital asset management solution later this year.

2. Some netizens commented, “The current demand for digital assets in the market is very high.”

On March 17, BitcoinTreasuries released a new report showing that activity in this field has increased by about 30% since November 2017. According to the researchers, this trend will continue. “However, we still need to conduct some broader research on the business of these companies,” the analyst explained. “Just like traditional investments, investors should pay more attention to the growth of their risk preferences, as this situation often changes with price fluctuations.”

4. In early May of this year, CME Group announced that it is trying to create an alternative solution for Bitcoin to fill the current market gap. The latest data released by the company on Wednesday showed that the total open interest of this futures contract reached $1.2 billion, reaching a historical high. At the same time, CME has also approved the second listing date for this product. It is worth noting that the U.S. Commodity Futures Trading Commission rejected the ETF application on the condition that the fund obtain exemptions as required by regulatory agencies.

5. In the past week, the volatility in the global financial industry seems to have not eased, especially in the U.S. stock market. While many people believe that the stock market may soon decline, giving pressure to the stock market which has performed well, there are also voices pointing out that as inflation expectations continue to rise, the Federal Reserve may take restrictive measures to increase bond yields. However, if this is the case, it is definitely not just speculative behavior caused by the depreciation of the US dollar. There may be more reasons such as people’s uncertainty about the future prospects or concerns about the deterioration of the economy, etc. (Image source: Twitter)

After Bitcoin’s sharp drop of over 10% on the evening of June 16, it fell again, with a recent low of around $9,160; and now it has fallen to around $8,250, although the increase is not significant.