This week is undoubtedly one of the most volatile price actions seen in the crypto market for months, with new all-time highs and sharp declines. Let’s break down some of the key events that happened in the crypto market this week.
Institutional adoption continues
WeWork announced this week that it would hold Bitcoin on its balance sheet, following the likes of Tesla, MicroStrategy, and TIME Magazine. The office space provider will accept Bitcoin, Ethereum, USDC, Paxos Standard, and other cryptocurrencies as a form of payment through BitPay.
Three Ethereum ETFs were launched on April 20, as three companies received approvals to offer exposure to Ether.
Ethereum records a new all-time high at above $2,600
Ethereum recently went through the Berlin hard fork to solve scalability issues and its high transaction fees. Ethereum broke correlation with Bitcoin and made an all-time at above $2,600 while Bitcoin’s dominance declined. Volume poured towards altcoins, and ETH was leading the market.
Despite recording new highs, Ethereum price eventually also tumbled as fears swept through the market. With Ethereum 2.0 highly anticipated, ETH price would likely be able to sustain current price levels.
Bitcoin ETF and more regulations are likely to come to crypto
Focusing on the US market once again, a Bitcoin ETF is yet to be approved in the country. However, since Canada has launched Ether ETFs this week, it could likely happen soon. What does this mean for the crypto markets?
With a new institutional product coming for the industry, this could mean more adoption of digital assets, leading to more retail investors entering the market — which could lead to higher prices.
Additionally, the SEC and the CFTC will form a working group that would oversee new crypto regulations in the future.
DogeDay was a disappointment
The highly anticipated DogeDay resulted in the cryptocurrency crashing as the hype around the altcoin was not enough to sustain its price growth. Dogecoin was down by around 22% on April 20, while the cryptocurrency was able to gain massive social media attention. DOGE is now nearly 50% under its record high price.
Bitcoin drops to below $50,000
Last week, Bitcoin made an all-time high at nearly $65,000 in light of Coinbase going public. However, over the weekend, the crypto market tumbled, and Bitcoin lost most of its gains.
After crashing to around $50,900 earlier this week, Bitcoin failed to find support at above $52,000 and quickly crashed to lows of $48,000. BTC likely gained bearish momentum alongside the stock market with the recent news of US President Joe Biden looking to implement a tax hike on wealthy individuals in the country.
Bitcoin has traded roughly 23% below its all-time high price and is struggling to find support. It is essential to note that corrections are normal in every market, especially when Bitcoin has been surging for the past few weeks, leading to the Coinbase debut on the Nasdaq.
Most cryptocurrencies crashed alongside Bitcoin, as many investors fear higher capital gains tax once US President Joe Biden introduces a new tax proposal into law. This news matters for the broader crypto market as wealthy investors will be taxed higher later if they decide to cash out their digital assets for fiat if the proposal goes through.
What’s next for the crypto market?
Although the recent price dip has caused a lot of panic in the market, Bitcoin’s on-chain data still shows a bullish case for the cryptocurrency. The market is only seeing lows seen in March prior to the recent bull rally.
Further, Bitcoin is on the expected trajectory on PlanB’s stock-to-flow model. However, stronger price dips could occur when the market rallies after the current consolidation. While Bitcoin is still maturing as an asset class, its volatility remains high compared to traditional assets. To better prepare for the volatility, crypto traders must set stop-losses.
However, stop-loss functions offered by exchanges may not be enough to protect your capital in such uncertain times. All-in-one trading platform CoinPanel aims to tackle this issue, as it offers stop-limit and stop-market functions, where you can prevent massive losses.
While at this moment in the crypto market consolidation, it’s important to set stop-losses, but when the BTC and altcoin markets pick up again, it would be essential to set take-profit orders. You can do both at the same time, including an entry order easily using the Full Trade feature on CoinPanel.