Bitcoin (BTC) is experiencing a pullback on Friday as traders take profits after the recent surge fueled by optimism surrounding the approval of a US spot Bitcoin ETF. The world’s largest cryptocurrency is currently trading just above the $33,500 mark, down close to 2.0% on the day. This drop marks the biggest one-day decline in over two weeks. However, despite the pullback, Bitcoin is still up around 14% in the past seven sessions and close to 25% for the month, demonstrating its strong performance recently.
The Impact of Spot Bitcoin ETF Approval Hopes
One of the main drivers of Bitcoin’s recent surge is the hope of the approval of a spot Bitcoin ETF. The latest CoinShares digital asset fund flows report indicates that institutional investors are increasingly getting involved in Bitcoin investment products, even without the formal approval of an ETF. This institutional adoption, coupled with growing optimism about continued adoption, supports Bitcoin’s bullish outlook. Additionally, Bitcoin has recently decoupled from stock markets, furthering the narrative that it is a safe haven asset similar to gold. This narrative has gained support from prominent figures in Wall Street, including BlackRock’s Larry Fink.
Implications of the US Federal Reserve’s Monetary Policy
The latest Core PCE inflation figures out of the US have not changed market expectations that the US Federal Reserve will maintain high interest rates for a lengthy period. This expectation, in combination with a strong economy and inflationary pressures, is likely to result in a hawkish message from the Fed in their upcoming meeting. Consequently, stocks are expected to face pressure, and US bond yields are likely to remain elevated. However, despite these macroeconomic conditions, Bitcoin and the broader crypto sector have outperformed. This suggests that crypto investors are focusing more on positive crypto-related fundamentals, such as adoption, rather than macroeconomic factors.
Other major altcoins, including XRP (XRP), Solana (SOL), Cardano (ADA), and Dogecoin (DOGE), are experiencing relatively flat to lower trading on Friday. However, these coins have still achieved strong gains over the week.
While blue-chip crypto markets consolidate after a significant surge, traders may turn to the highly illiquid shitcoin/meme coin markets in search of higher potential movers. It is essential to exercise caution when investing in such coins, as they often lack fundamental value and carry significant risks.
Exploring High-Risk, High-Reward Investment Strategies
For those seeking higher probability gains in the near term, participating in crypto presales can be an alternative high-risk, high-reward investment strategy. Crypto presales involve purchasing tokens of new crypto projects to support their development. These tokens are typically sold at lower prices, and there is a history of presales delivering exponential gains to early investors. However, it is crucial to conduct thorough research and identify projects with strong teams and innovative visions to mitigate risk. Cryptonews offers a list of the top 15 crypto presales for 2023 to assist investors in their decision-making process.
Disclaimer: Crypto investments carry a high level of risk. This article is for informational purposes only and does not constitute investment advice. Investors should be aware that they could potentially lose all of their capital.
