The cryptocurrency market continues to face pressure following a recent price drop, particularly for Bitcoin and Ethereum. However, experts highlight three key factors that may aid in price recovery.
Geopolitical Climate and the Crypto Market
The crisis between Israel and Iran has reached a peak stage, potentially leading to a reduction in tensions. Israel insists on preventing Iran from acquiring nuclear weapons, and recent actions, including strikes on facilities, may have alleviated the situation. Expectations of a truce are reflected in stable stock markets, where indices remain unchanged.
Historical Examples of Crypto Recovery
Bitcoin and other altcoins typically rebound after significant geopolitical events. For instance, the price drop in April following Donald Trump’s tariff announcement was soon replaced by a new record. Similarly, declines after Russia's invasion of Ukraine and the onset of the COVID-19 pandemic proved to be short-lived. Markets usually adapt to a new normal state.
Strong Fundamentals: Investment and Demand for Bitcoin and Ethereum
Fundamental indicators for Bitcoin and Ethereum remain robust, with active investments in ETFs and decreasing supply on exchanges. Over the last week, Bitcoin ETFs have added more than $1 billion in assets, bringing the total flow to $46.6 billion. Companies like Trump Media and GameStop continue to accumulate Bitcoin, which also contributes to positive market dynamics.
Despite current challenges, cryptocurrencies have the potential for recovery thanks to geopolitical changes and strong fundamentals. Investors will closely monitor the situation moving forward.
