Trace Mayer, a prominent bitcoin investor who has funded Kraken, Bitpay, and Armory, has stated that the bitcoin price is in a healthy uptrend to initiate new rallies in the short-term.
SegWit2x Cancelled, No Short-Term Uncertainty
If the SegWit2x hard fork was pursued as planned, it would have become a major factor that affects bitcoin price negatively in the short-term. As CCN.com reported, analysts like Willy Woo of Woobull.com predicted a massive crash due to the sell-off of B2X-expecting investors.
“Willy Woo, a highly regarded cryptocurrency and bitcoin analyst well known for his contribution to WooBull.com, has stated that the bitcoin price could suffer a major correction by the end of November, upon the SegWit2x hard fork,” read a CCN.com report earlier this week.
If the SegWit2x hard fork had happened on November 16 and the bitcoin price declined because of the fork and the sell-off of B2X dividend-taking investors reallocating their funds from bitcoin to altcoins, the bitcoin price would have likely struggled to remain in the $7,000 region.
But, the cancellation of the SegWit2x hard fork eliminated any uncertainty surrounding the mid-term performance of bitcoin and most importantly, eliminated the possibility of a split chain by the end of 2017. As such, many analysts including Mayer, Max Keiser, and Tom Lee have predicted the bitcoin price to achieve the $8,000 mark by the end of this year.
Over the past few days, the bitcoin price has been extremely volatile, understandably due to market instability after the SegWit2x cancellation and the major correction that had led the bitcoin price to fall from a new all-time high at $7,900 to $7,200. Despite the major correction and high volatility, Mayer stated that bitcoin is at a prime position to recover and initiate strong rallies in the short-term, given its performance in the past two weeks.
While volatility has increased substantially, other indicators of market stability have improved significantly. Specifically, the daily trading volume of bitcoin has increased to over $3.3 billion, nearing that of Apple, the most liquid stock on earth.
Short-Term Bullish Indicators
For many months, the global bitcoin market has been focused on the development of futures exchanges by CME Group and CBOE, two the largest options exchange in the world. The launch of futures exchanges by the two institutions is expected to provide substantial liquidity to institutional and retail traders in the upcoming months.
However, in the short-term, it is important to observe the development of the Japanese bitcoin market, the largest bitcoin market by trading volume which is responsible for more than 65 percent of bitcoin trades, as the mainstream adoption of bitcoin in the country has been increasing at an exponential rate.
According to a report by Nikkei, 4,500 large-scale stores and merchants already accept bitcoin as a payment method in Japan, including leading retailers, airlines, hotels, and even restaurants. That number is expected to increase by five-fold, to 25,000, by the end of 2017.
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Last modified: May 21, 2020 9:07 AM UTC