For the first time in February, the cryptocurrency market has recovered to $500 billion, as most major cryptocurrencies including bitcoin and Ethereum recorded large gains in the past two days.
Within the past 24 hours, bitcoin recorded a price increase 9 percent, rising from $10,030 to $10,850. Premiums in the South Korean cryptocurrency market have reemerged, and over the past 24 hours, bitcoin has been traded in the South Korean market with a 2 to 3 percent premium. At the time of reporting, on Bithumb, South Korea’s largest cryptocurrency exchange, bitcoin is being traded at $11,200.
Relative to major markets like Japan and the US, the South Korean cryptocurrency exchange market has significantly smaller supply of most cryptocurrencies. Hence, when the demand for bitcoin or other cryptocurrency spikes, premium rates tend to reemerge. The reappearance of premiums signal an increase in demand for cryptocurrencies by local investors, which is an optimistic indicator of short-term recovery, especially in the Asian market.
The daily trading volume of bitcoin across all major cryptocurrency exchanges has been stronger in the last 24 hours than any period in the past week, which demonstrates sufficient momentum to lead a short-term rally in the upcoming days. Several analysts have stated that if the price of bitcoin can surpass the $11,500 mark, it will carry its momentum towards the $13,000 region.
Earlier this week, several mainstream media outlets in South Korea reported that many families have sent children and young adults bitcoin as the traditional lunar new year pocket money, instead of cash. Evidently, some instances of lunar new year pocket money payments with bitcoin did not contribute to the recent rally of bitcoin. But, a significant amount of positive press have come out due to such instances, and consequently, the demand for bitcoin within the local South Korean market has started to increase once again.
Ethereum and the rest of major cryptocurrencies have more or less followed the price trend of bitcoin over the past week. Only a few cryptocurrencies such as NEO have outperformed bitcoin in the past 24 hours and the majority of cryptocurrencies have struggled to match the strong performance of bitcoin.
Many ICO projects and tokens have increased in value due to some optimistic reports from Switzerland. This week, Swiss financial watchdog released a guideline on ICOs, with the intent of regulating ICOs with transparency. Given that most ICOs are based in Switzerland, the plan of the government to allow ICOs to be conducted in the future creates a better ecosystem for blockchain projects.
Peter Todd, a Bitcoin Core developer and cryptocurrency expert, stated that if governments decide to regulate ICOs, they should strictly regulate ICOs that do not ostensibly seem harmful or bad, to ensure investors are protected.
“I’m just saying that if they exist and they feel that their mandate is to prevent harm, the harm they should be preventing is not the obvious fraud — it’s things that are not obviously fraudulent. That’s where the actual harm is,” said Peter Todd, who plans to discuss more about the state of ICOs at the Genesis London conference on February 22.
Last modified: June 11, 2020 10:05 AM UTC