The rise of the cryptocurrency Bitcoin near a record level has revived market sentiment, not only in the broader cryptocurrency market , but also in the financial markets that left the digital assets sector in a declining state last year, according to a Bloomberg report.
The improvement in morale is evident through the growing expectations for acquisition deals among companies in the cryptocurrency sector. A notable example is Robinhood Markets’ acquisition of the Bestam Limited cryptocurrency platform on Thursday. Additionally, there has been a resurgence in investments reaching record levels for initial public offerings (IPOs) of companies within this industry.
Restore the market
In the cryptocurrency market itself, the market has recovered, at a time when celebrities are promoting cryptocurrencies again, and thousands of cryptocurrencies are being created daily.
About 330,000 cryptocurrencies debuted in the overall Ethereum system during April and May alone, according to cryptocurrency data tracking site Dune.
The data indicate that there is no such thing as rising prices that make investors forget previous financial shocks (including the bankruptcy of the FTX cryptocurrency exchange and the Celsius platform) in a market known for its scandals and boom and bust cycles.
“Bloomberg” quoted Campbell Harvey, professor of finance at Duke University, as saying, “Investors often have a short memory. When market sentiment is high, they focus more on good news, and tend to underestimate the importance of bad news that may have occurred in the past.”
Last week, Bitcoin rose to approximately 2.5% from its all-time high of $73,798, which it reached in mid-March, amid increasing demand for recently authorized exchange-traded funds.
While the leading cryptocurrency is up nearly 70% this year, the gains pale in comparison to the returns of speculative coins like Dogwifhat and Bon
Traded funds
The recovery began this year when the SEC approved ETFs investing directly in Bitcoin in January, and then in May the SEC took a step toward approving similar Ethereum ETFs, a move seen by many in the industry as a capitulation. There is increasing political pressure to legitimize cryptocurrencies and create new laws that will facilitate the role of companies working with digital assets.
Major financial companies are expanding their business deeper into the field of US Bitcoin ETFs attracted inflows of $15.6 billion, into nearly 10 products, bringing their total assets to $62.3 billion, according to data compiled by Bloomberg.
Cryptocurrencies. Earlier this week, MasterCard reinstated its support for Binance, the world’s largest cryptocurrency exchange, allowing users to make purchases on its network once again.
Binance reached a settlement with the Justice Department over anti-money laundering and other violations last year, and still faces charges from the Securities and Exchange Commission.
A MasterCard spokesperson said in a statement, “Over the past few months, we have reviewed the improved controls and processes implemented by Binance… and accordingly we have decided to allow Binance-related purchases on our network.”
Cryptocurrency funds have flourished, with the number of funds established increasing to the highest level since the second quarter of 2021, according to the Cryptocurrency Research Fund.
