Bitcoin Surges to $60,000: Will the Rally Continue or Is it the Last Celebration?
Bitcoin experienced a significant surge this week, with a 12,600-point increase, representing a 25% surge. It also reached $63,000, coming within 10% of its all-time high of $69,000.
Can the cryptocurrency market continue to thrive or is it simply overvalued? We can analyze this from both a financial and emotional perspective.
Financial Perspective: ETF Opens the Doors to Hot Money Inflows
Starting with the financial aspect, since the approval of the BTC ETF on January 11th, we have observed a continuous increase in net capital inflows. From the first week of outflows, we now see a net inflow of approximately $500 million per day. Traditional institutions’ interest in Bitcoin has not waned over time; instead, they have provided a steady stream of buying support, turning the cryptocurrency market into an incremental market.
Emotional Perspective: Warm Sentiment, but No Signs of a Peak Yet
According to the “Shoeshine Boy Theory,” we can use Google Trends and Coinbase rankings in the U.S. App Store to determine if Bitcoin is being widely discussed around the world.
We examined the global search interest for three keyword groups: bitcoin, ETH, and Crypto. Undoubtedly, bitcoin had the highest level of interest, but it currently sits at 50, indicating that its popularity is only at half of its peak.
Despite recent price surges, search interest is only half of what it was on January 7th, suggesting that more users can be expected to enter the market.
Turning to Coinbase’s ranking in the U.S. App Store, it currently stands at 15th place in the finance category, with no presence on the overall rankings.
In October 2021, when Bitcoin reached $69,000, Coinbase ranked first overall. Thus, sentiment has not yet reached its peak.
Although the financial and emotional perspectives indicate that the market has not peaked, the recent violent surge in prices and high short-term volatility suggest caution when using high leverage to avoid the risk of positions disappearing due to unchanged prices.
Weekly Highlights in the Cryptocurrency Market
Uniswap Plans to Distribute Protocol Fees to UNI Token Holders
The Uniswap Foundation announced that the “Uniswap Protocol Governance Activation” proposal will begin on March 8, 2024. This proposal suggests upgrading the protocol to reward UNI token holders who delegate and stake their tokens.
News Interpretation: This development is not only highly positive for Uniswap but also for Dex tokens as a whole, leading to a 30% surge in the sector this week.
Pantera Capital Research Report: Bitcoin DeFi Ecosystem Expected to Reach a Total Value of $450 Billion
Cryptocurrency investment firm Pantera Capital recently released a research report stating that the total value of Bitcoin’s DeFi applications could reach up to $450 billion, accounting for 25% of Bitcoin’s market value.
Over time, this estimated total value could reach as high as $450 billion. Additionally, the estimated final valuation for the top Bitcoin DeFi applications could range between $6.5 billion and $40 billion, with a potential valuation of $20 billion (2.2% of Bitcoin’s value). This would position them among the top 10 most valuable assets in the cryptocurrency ecosystem.
News Interpretation: Currently, Bitcoin Layer 2 Merlin has a total value locked (TVL) of $1.9 billion, which is roughly equivalent to the combined TVL of Polygon and Avalanche. The future of Bitcoin’s ecosystem looks promising.
Arweave Releases Arweave AO Public Testnet, Mainnet Expected to Launch Within the Year
Arweave has launched the Arweave AO public testnet, a network designed to support smart contracts and blockchain protocols with high scalability. Additionally, Arweave has disclosed plans to launch the mainnet by 2024.
Please note that the views expressed in this article represent diverse opinions and do not necessarily reflect the stance of “WEB3+.”
Proofreading Editor: Gao Jingyuan
