The virtual asset market has been in a downward trend this month. This is because overheated investment sentiment is calming down and there is also news of Bitcoin (BTC) redemption from Mt. Gox, a Japanese virtual asset exchange that went bankrupt in 2014. However, the analysis is that there are still events that will lead to price increases, such as expectations for a U.S. base interest rate cut, the presidential election, and the launch of an Ethereum (ETH) spot exchange-traded fund (ETF).
According to CoinMarketCap on the 26th, the BTC price the previous day fell to $58,890 at one point. This is the first time since the 2nd of last month that the BTC price fell below $60,000. Altcoin prices (virtual assets excluding BTC) also fell. On the morning of the same day, the price of ETH was traded at $3,259, down 6% from the previous day. The prices of Ripple (XRP) and Binance Coin (BNB) fell by about 3 and 5%, respectively.
The reason virtual asset prices have fallen since the middle of this month is interpreted as the fact that overheated investment sentiment over the past year has subsided. Jeong Seok-moon, head of Presto Research Center, said, “Investment toward technology stocks that have risen a lot (such as Nasdaq) is subsiding, which is also affecting BTC.” Song Seung-jae, an analyst at AM Management, said, “Every year, adjustments appear around May to August, and the existing trend continues from August to September. This is a reorganization process before the rise cycle in the second half of the year arrives.”
News of Mt. Gox's BTC redemption also had an impact on the price decline. When Mt. Gox announced the day before, “We plan to start repaying creditors with BTC and Bitcoin Cash (BCH) next month,” concerns arose in the market that a large amount of BTC would be poured in. Analyst Song cautioned, “We need to be mindful of further price declines for about a month due to the redemption of Mount Gox and the sale of BTC by small and medium-sized miners.”
However, the analysis is that there are still favorable factors that will lead to an increase in the price of virtual assets. Analyst Song explained, “The market may rebound due to expectations of a base interest rate cut due to slowing inflation and the U.S. presidential election. Rather, there are many positive factors in the market in the short term.” Center Director Jeong said, “The listing of the ETH spot ETF early next month and investor reaction to it are also noteworthy events,” adding, “The timing of a short-term rebound (in virtual asset prices) cannot be predicted, but if you hold large virtual assets for long-term holding purposes of 4 years or more, it is always a good ( “(Buy) timing,” he analyzed.
- Reporter Choi Jae-heon
- chsn12@decenter.kr
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