February 2024 – Forbes Advisor INDIA

The cryptocurrency market witnessed a strong recovery in the year 2023 after the crypto market saw a slight downside due to the global macroeconomic situations and inflation data. In the beginning of the new year 2024, BTC rose to a high of $45,208 and the world crypto market capitalization traded at $1.74 trillion as of January 03, 2024. The rise happened as expectations of a permission for exchange-traded funds to enter invest. the largest cryptocurrency token strengthened.

The leading coins of the crypto market – Bitcoin and Ethereum – showed incredible stability at the beginning of the year and traded in the green with a marginal rise. Let’s look at the important reasons that made the cryptocurrency market hopeful in 2024 and what approach investors should have in this unexpected crypto rally.

At the time of writing, ie as of February 13, 2024, BTC has reached the $50,107 level for the first time since December 2021 with a market cap of $982.72 billion. This raised hopes among the bitcoiners. Blocks until 10,829 are halved and this is expected to happen in April 2024. 69 days from now.

Crypto markets on the road to recovery

Overall, the crypto market has moved from “fear” to “neutral” and now it’s “greed”. The world’s largest cryptocurrency, Bitcoin, is rising exceptionally from October 2023 and is currently hovering around the $50,000 level from February 13, 2024 for the first time since December 2021.

On the other hand, Ethereum also showed signs of recovery, corrected a bit and was above the $1,850 level. Ethereum marked its highest high since August 2022 after touching the $2,100 level in mid-April 2023. This rally was seen immediately after the successful launch of the ETH hard fork “Shapella”, which changed the landscape of the cryptocurrency Ethereum and its applications. Currently, ETH is trading at 17.0% and forming a strong resistance at $2,652 levels.

The cryptocurrency market usually gets volatile when it comes to announcements from the US Fed, as crypto experts closely monitor such major developments that can directly affect market liquidity factors and as rising interest rates can potentially hurt stocks, commodities, and cryptocurrencies as well.

Earlier this month, the market saw massive support due to various optimistic factors such as inflation tackling methods and the weakening dollar index in the US, which boosted the overall sentiments.

However, if we observe the broader level, the entire cryptocurrency market, including BTC and ETH, shows very little signs of recovery. Moreover, ceiling and interest rate hikes in the US, and the inflation data put the crypto traders in a scary position. But now crypto markets as a whole, leading the way to resistance before the high jump.

Performance of the most popular cryptocurrencies

(From 13 February 2024)

Crypto experts believe that BTC has seen quite a recovery in the past few days. This correction in BTC shows the overall state of the crypto sector. Now, any move, be it a break from the downtrend channel and clear trend reversal, can help further correct the prices of the Bitcoin.

What lies ahead for the crypto market?

The crypto market has been under a lot of pressure due to the extensive concerns about the SEC allegations and charges on the crypto exchange Binance and also the global inflation scenario. However, cooling inflation data and various other global factors balanced the downward momentum of Bitcoin and other cryptocurrencies such as Dogecoin, BNB, Solana and many more.

The US Federal Reserve held rates steady at its June meeting of the Federal Open Market Committee (FOMC), interrupting the 15-month rate hike cycle, pushing the dollar high and increasing market volatility in the country’s treasury, which could lead to more traders participating in risk assets such as cryptocurrencies. The FOMC also agreed to pause its interest rate hikes in June to assess the impact of its growth and embattled tightening campaign on inflation.

At the moment, the global crypto market capitalization stands at a solid $1.87 trillion. Last time, the crypto market recorded smaller positive signs due to easing in macroeconomic activities which led to the price of cryptocurrencies. The main reason was due to the Federal Reserve’s approach to an increase in interest rates, increasing confidence in the direction of decentralized finance after the banking fiasco in the US or to avoid recession, or the cryptocurrency market received great support from such factors and positive outlook for the rest of the year.

There are also high hopes for the monetary policy returns that could include BTC and other digital assets, and change the minds of those regulators who otherwise seemed hell-bent on cracking down on virtual assets.

In addition, there is also a primary reason for this recent crypto mini-bull rally. Bank contagion resulted in large losses on various bong holdings, forcing the Federal Reserve to go easy on interest rate hikes to combat severe liquidity issues. The current interest rate in the US at the time of writing is at 5.25%.

Higher inflation rates have always weighed on risky assets like cryptocurrencies, as demand for them dampens when rates rise. The year 2022 was brutal for cryptocurrencies and in the second half of the year 2023, the cryptocurrency followed the recovery path. The massive global uncertainties and FTX fallout have resulted in the markets being hit worse than ever before.

Aside from BTC rising and the crypto world recovering strongly, another setback was seen recently when Binance CEO Changpeng Zhao pleaded guilty and stepped down for violating US anti-money laundering laws as part of a $4 settlement ,3 billion. The multibillion-dollar settlement was made to resolve a years-long investigation into the crypto-exchange world, according to prosecutors. In the ongoing agreement, Zhao will personally pay $50 million, which prosecutors describe as one of the largest corporate fines in US history.

Let’s look at the values ​​of market capitalization over the years, from November 2021 to January 2024:

Crypto market cap

How to Invest in Crypto?

The most important thing to remember before investing in a cryptocurrency is that the crypto market is highly volatile and investments may not always go as planned. Currently the market is still recovering and investing now may not be a good idea, even the crypto experts are confused with the dynamics of the current crypto market.

It would be a wise choice not to invest all your life savings in cryptocurrencies, and do your research and analysis before investing.

Let’s see how you can invest in crypto through the steps:

Step 1: Understand and do your research on the crypto market.

Step 2: Choose the amount you are willing to invest.

Step 3: Choose the cryptocurrency you want to invest in.

Step 4: Choose a crypto exchange platform for your investment. Refer to our article on the best crypto exchanges and apps in India.

Step 5: Create your own account through the exchange platform.

Step 6: Complete the verification and KYC process.

Step 7: Fund your crypto account and you are good to buy your desired crypto coin.

Step 5: Choose a crypto wallet to store your cryptocurrency. There are various digital wallets such as mobile wallets, hardware wallets, desktop wallets and online wallets. Learn about the best crypto wallets in India.

Step 6: Secure your wallet.

Step 7: Hold and then sell to profit.