Analysts named 3 reasons why Bitcoin exceeded $40,000
Bitcoin, the world’s largest cryptocurrency by market capitalization, was able to make a massive take-off, while exceeding the $40 000 mark – this is the highest level since June 16 of this year, adding 17% in just 8 hours.
First reason: Bitcoin suffered “Perfect short compression”
Financial analyst Alex Kruger commented that Bitcoin went through the ideal short compression stage:
Picture perfect short squeeze on $BTC. This belongs in a textbook. pic.twitter.com/FRLXtcCXiw
— Alex Krüger (@krugermacro) July 26, 2021
Such a short compression, as experience shows, always occurs at a stage when a certain asset very quickly gains price due to a large number of bets against this asset. Traders have no other path than redemption. Only in this way can they cover their losses, which allows this asset to gain a price.
Also, a journalist from China, Colin Wu, commented on what was happening:
“Today the volume of liquidation exceeded $ 800 000 000 and the main short position is completely liquidated. The amount of elimination of short items over the past 12 hours has reached $ 640,000,000. This is the largest volume of one-day elimination of short positions in the last 2 months. “
In total, over the past 24 hours, short positions worth more than $ 900,000,000 were eliminated.
Second reason: Amazon site news
The reason for this bullish growth was news regarding the Amazon Internet site. On July 25, the City AM newspaper gave a link to an anonymous source with information about the readiness of the Internet site to accept yuitkoins as payments:
“Cryptocurrency in the future will be a full and integral part of the mechanism for paying for goods on the Internet sites, in particular Amazon, and it all begins with Bitcoin, because it is the first and key cryptocurrency project.”
The source meant the “key cryptocurrency project” – that the main Internet platform is largely ready for the launch of receiving payments, and not only Bitcoin. Amazon’s technical side is now studying the complexity of the issue for integrating payment cryptocurrency funds from 10 leading cryptocurrencies. “
“Ethereum, Cardano ADA and Bitcoin Cash will be the first priority after Bitcoin. This will take little time, since these works have been underway since 2019, “the source added.
Amazon has not yet given dates for receiving cryptocurrencies, but the market is already reacting and evaluating this possibility.
The third reason is very simple: Elon Musk, Katie Wood and Jack Dorsey trust bitcoin, and news from China has already been put into the market
The result of the long conference “The B Word,” organized by Crypto Council for Innovation, was the performance of many famous personalities, such as Elon Musk and Jack Dorsey, who gave a positive trend towards Bitcoin.
Experts attribute Bitcoin’s growth to the adoption of cryptocurrency as a means of payment in SpaceX and Tesla.
The expert opinion surged towards concerns about the negative impact on the surrounding world in the extraction of Bitcoin. Also, tough regulatory measures in China began to fade over time, and it is quite possible that this also positively affected the market.
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