With the recent rebound across cryptocurrencies of various types, it’s time to take a hard look at the ones most likely to return on investment.
The rebound started back in mid-August, when the total value of cryptocurrencies’ market capitalisation surpassed $2 trillion again, the first time they have done so since crashing almost three months prior, according to Forbes.
Markets hitting the threshold marks a bullish recovery, according to most analysts. Bitcoin hit a three-month high on August 22, jumping past $50,000. It has fallen back slightly since on profit-taking. Ether and Binance coin, the next two largest cryptocurrencies, both were up greater than 20 per cent, hitting their own three-month respective highs around that time.
One factor driving this rebound is that the bitcoin ‘whales’ are moving money into crypto markets again. The whales are those who hold a very large amount of bitcoin, but they often invest in other cryptocurrencies as well.
Accounts holding roughly $50 million or more worth of bitcoin have steadily increased their buying since the end of June, according to new data from blockchain firm Chainalysis. Bitcoin whale activity has been tightly correlated to price action this year, with larger investors often acting as a “driving force” in the market, says Philip Gradwell, chief economist at Chainalysis.
Ethereum’s cryptocurrency ether has gotten great advantage from this trend. The smart contracts crypto is up to $3,810 at this writing, a three-month high. Trading intensity is low, meaning that holders of ether are keeping it close and acquiring more.
And analysts are bullish. “Ether is on track to potentially breach the $4,000 resistance level, provided the obvious stack up continues,” Nick Agar, founder and CEO of cryptocurrency firm AXIA Coin, wrote in an email to MarketWatch.
“A number of metrics indicate positive sentiment, including the volume of large transactions of ether, which reached $16.2 billion, the highest since June 22,” crypto analytics firm IntoTheBlock wrote in a series of tweets.
IntoTheBlock’s Hodlers indicator shows that addresses with holdings in $ETH for over 1 year is reaching all time high levels. The chart shows how the number of Hodlers has been increasing non-stop over the past 12-months. And the social media narrative about Ethereum has been extremely positive in recent months, the group adds.
An important part of the Ethereum narrative is the consequences of its London Hard Fork, in particular the doubling of block size and the EIP-1559 operations which manage ‘gas’ fees better.
These took place in early August, and have had the effect of decreasing supply for ether as demand to use Ethereum increases.
The increasing demand is coming from the world of decentralised finance. A decentralised finance (DeFi) system allows people to create financial products or “smart contracts” that execute actions automatically on the blockchain – without any bank,…
Read more:Hot crypto investments: Ethereum is on the rise | Cyprus Mail
