Publicly listed digital asset broker GlobalBlock (TSXV:BLOK) market analyst Marcus Sotiriou weighed in on the recent Bitcoin price (BTC/USD) movement that saw it briefly trade above $28K for the first time in months over the weekend.
Sotiriou believes the recent closures across the US banking sector acted as a catalyst for the bitcoin price.
Start of a new Bitcoin bull trend
After a great performance of the weekend that saw bitcoin hit a high of $28,527.72 earlier today, bitcoin seems to be consolidating its recent gain after settling at around $27,697. According to Marcus Sotiriou, the recent price surge signals the start of a new bull trend.
In a note to media outlets on recent moves and news in Bitcoin and digital assets, Sotiriou said:
“Technically speaking, this signals the start of a new bull trend for digital asset trading and the end of the bear market. To be confident of a trend reversal, we need to see how Bitcoin reacts at the support level of $25,200.”
Relation between Bitcoin price and bank closures
The analysts further stated that the recent Bitcoin price movements were in a way triggered by the collapses being witnessed within the US banking sector which has seen several banks including Silicon Valley Bank (Nasdaq: SIVB) collapse. Sotiriou said:
“The recent closures of US banking giants have acted as a catalyst for Bitcoin’s price increase, as the drawbacks of the banking system are a key proponent for decentralised assets such as Bitcoin.”
The analysts also said that there is huge speculation in the market and we could see a big move in either direction, especially going by the rise in open interest in Bitcoin futures. He stated:
“Despite open interest not giving us knowledge as to the direction of the positioning, it shows us that there is huge speculation in the market right now, so we could see a big move in either direction. Due to the funding rate of most coins flipping green, I am anticipating a flush in the market soon, as a positive funding rate indicates that the positioning in the futures market is mainly aggressive longs – when there is high open interest with aggressive longs, it typically means over-leveraged longs need to be wiped out.”
Sotiriou’s reasoning seems to resonate with that of a venture capitalist and angel investor Balaji Srinivasan who is betting $1 million on Bitcoin reaching $1 million in the next 90 days. Balaji says hyperinflation is happening now.