Cryptocurrency
3 Possible Reasons Behind Bitcoin’s $4K Daily Surge
Bitcoin recorded one of its most impressive daily performances in recent history yesterday when it pumped from a daily low of $53,600 to just over $58,000.
Here are some of the possible reasons behind this surge while the community speculates whether the worst has passed and BTC could resume its 2024 bull run.
ETF Flows
Ever since their inception in mid-January this year, the US spot Bitcoin ETFs have played a significant role in the underlying asset’s price movements. Trends of positive flows have led to price increases and vice versa.
As such, it wasn’t a big surprise that BTC tumbled hard in the past few weeks, from over $64,000 (on August 26) to under $52,500 (on September 6). Within this timeframe, the ETFs saw almost $900 million in net outflows.
However, the trend changed on Monday, and investors broke the longest negative streak in the history of ETFs. The net inflows for the day exceeded $28 million, and this could be among the most probable reasons behind BTC’s price resurgence.
Going Against the Crowd
The popular crypto analytics tool, Santiment, has repeatedly outlined a certain strategy that’s relatively unpopular among the community. After all, it advises traders to go against the crowd, which seemed to have worked in the past day.
The latest report informed by traders had ‘heavily’ shorted BTC on major exchanges like Binance and BitMEX since Saturday. According to Sentiment, “trader FUD and doubt in this rally will only fuel prices higher.”
Bitcoin’s market value is finally rallying, making it as high as $57.6K Monday and +4.8% in the past 24 hours. On major exchanges like Binance & Bitmex, Bitcoin has been heavily shorted since Saturday. Trader FUD and doubt in this rally will only fuel prices higher. pic.twitter.com/1uY1AaQBLx
— Santiment (@santimentfeed) September 9, 2024
Stablecoins Inflows
Another possible reason behind BTC’s impressive daily surge could be attributed to investors trying to take advantage of the price dip. This is supported by data from IntoTheBlock, which reads that $300 million worth of stablecoins were transferred into exchanges on Monday.
Stablecoins are the easiest gateway for investors to purchase digital assets on exchanges. Such large movements are typically executed to look for good buying opportunities, such as the recent price dips.
$300 million worth of stablecoins flowed into exchanges yesterday, signaling a potential move by investors to capitalize on the dip. pic.twitter.com/c7CTrqc8oT
— IntoTheBlock (@intotheblock) September 10, 2024
Back in early August, when BTC’s price tumbled even lower (under $50,000), the total stablecoin inflows skyrocketed to around $1 billion. Days later, the cryptocurrency, alongside most of the market, recovered its losses and even soared past $65,000 in weeks.
Something relatively similar on the matter came from Lookonchain. The on-chain resource informed that larger bitcoin investors had withdrawn more than $34 million worth of the asset in the past day alone. This could reaffirm the thesis that investors have used the opportunity to go on a buying spree.
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XRP seems to have found support around 50 cents. Can buyers push the price higher this week?
Key Support levels: $0.50
Key Resistance levels: $0.54, $0.68
1. Price Finds Support
After a sharp fall last week, bulls appear to be back. XRP opened this Monday in green and is keen to return on an uptrend. As long as the key support at 50 cents holds, buyers have a good chance to return on the offensive.
2. Sellers are Retreating
Early October saw a spike in sell volume, but now sentiment across the market is improving, which could see the momentum shift back into the bulls’ favor. If so, buyers can aim to take XRP back above 60 cents. However, once there, sellers could return, as in late September.
3. MACD Momentum Shifting
After a difficult start this month, the momentum on the daily MACD is showing the first signs of a reversal, with a histogram making higher lows. If this trend continues, buyers could soon take over the price action and push XRP to break higher again.
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The price of Bitget’s BGB token unexpectedly dropped by 50% on the morning of October 7 before beginning to recover.
The platform has announced that it will compensate users for any losses resulting from the sudden volatility, which is still under investigation.
Exchange Promises Full Compensation
According to CoinGecko data, the incident saw the token’s value fall from $1.14 to $0.64 before staging a quick recovery. In a post on X, Bitget addressed the situation, saying, “BGB experienced unexpected volatility today due to market conditions, but the price has quickly stabilized.”
The platform reassured its users, promising to fully compensate for any asset losses. It also announced that a detailed compensation plan would be released within 24 hours, with the entire process set to be completed within 72 hours.
Bitget CEO Gracy Chen reiterated this message in a separate X post:
“The incident is still under investigation, but I want to assure everyone affected that we will not let any Bitget users suffer losses.”
Chen emphasized that Bitget’s overall standing remains strong, noting that the platform achieved a global market share of 11% in the third quarter of 2024, making it the fourth-largest exchange globally. Additionally, it boasts an asset reserve exceeding 176% and holds the second-largest protection fund globally, which is designed to compensate users quickly in the event of such incidents.
The Nature of Flash Crashes
Meanwhile, this incident mirrors a past development that occurred earlier this year with OKB, the native cryptocurrency of the OKX exchange. The token faced sudden price collapses, falling from a high of $48 to $25 within hours. The event was reportedly triggered by several large leveraged position liquidations, leading to further sell-offs and price declines.
At the time, OKX responded by reassuring its users that it would compensate them for the losses incurred from the unusual liquidation. While OKB’s crashes were linked to market-wide volatility, Bitget has yet to pinpoint the exact cause behind today’s event.
A cryptocurrency “flash crash” occurs when several holders rapidly sell a specific crypto asset, surpassing buyer demand and causing the price to drop sharply in a short amount of time. Unlike a typical collapse, the price usually recovers quickly, often returning to a level close to where it started.
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[PRESS RELEASE – Dubai, UAE, October 7th, 2024]
On October 22-23, the Blockchain Life 2024 forum will take place in Dubai. Over 10,000 participants from 120 countries will come together for the crypto event to share industry insights on the eve of Bull Run 2025.
Participants will hear from leading voices in the blockchain space, who will share market analysis on market trends and potential future developments.
Confirmed figures include:
- CEO Tether – Paolo Ardoino
- Co-Founder Animoca Brands – Yat Siu
- CEO Ledger – Pascal Gauthier
- CEO Cardano Foundation – Frederik Gregaard
- CEO Dubai Blockchain Center – Dr. Marwan Alzarouni
- Co-Founder Litecoin Foundation – Xinxi Wang
- CEO Vechain – Sunny Lu
- CEO of dYdX Foundation – Charles d’Haussy
- Founder Listing.Help, Jets Capital – Sergei Khitrov
- Founder DWF Labs – Andrei Grachev
- Co-Founder Tezos – Arthur Breitman
- CEO Trust Wallet – Eowyn Chen
- Co-Founder Osmosis Labs – Sunny Aggarwal
- Co-Founder of Sui (Mysten Labs) – Kostas Chalkias
- Head of Investments at Maelstrom Fund – Akshat Vaidya
- Founder Notcoin – Sasha Plotvinov
- Co-Founder, CEO Celestia Labs – Mustafa Al-Bassam
- Google Cloud – Tiago Henriques
- Program Lead MetaMask – Zied Brini
In addition to the lineup of speakers, Blockchain Life 2024 is also set to include behind-the-scenes discussions that will provide an opportunity for networking and exchanging information on the latest advancements in the sector.
The forum is coming soon. Readers can purchase tickets with a 10% discount using promo code chainwire.
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