Why the bitcoin exchange rate has skyrocketed and what is next for the cryptocurrency market

But time and again, their apocalyptic prophecies are shattered by the realities of a vibrant and dynamic market. And so it is this time. This Thursday (today), June 22, the bitcoin's price started a new upward march, adding 5% in one day and almost 21% in a week.

Yesterday, the rate reached $30.7 thousand per coin, and today it has adjusted by $30.3 thousand. A normal story after a sharp rise. Especially considering that as recently as Monday, June 19, the market was in the range of $26.4-26.6 thousand.

Not everyone can comprehend this dynamic after the news of the US Securities and Exchange Commission's (SEC) lawsuit against the two largest crypto exchanges, Binance and Coinbase. However, the market and investors were positively affected by the announcement from the Federal District Court of the District of Columbia (USA), which pushed the SEC to reach a deal with Binance.US (the American division of Binance) - the court did not allow the freezing of the exchange's assets in the United States. They remained in working order. At the same time, the authorities tried to ensure transparency: Binance.US officials have limited access to private keys for their wallets, as well as root access to Amazon Web Services tools. At the same time, officials ensure that Binance Holdings officials do not have access to these resources.

The interest in bitcoin and its exchange rate was further fueled by news about new tools that continue to develop actively despite everything. I am referring to the application of the world's largest investment company BlackRock to the SEC to create a spot ETF on the bitcoin. The crypto market is positively influenced by the interest of such an influential company as BlackRock in this area, as everyone knows about its large-scale investment opportunities. Moreover, the financial community highly appreciates the chances of granting this application. Everyone knows that BlackRock has only once refused to approve an application for an ETF on other assets.

In addition to BlackRock, several other players, including WisdomTree, Invesco, and Bitwise, have filed similar applications with the SEC. Today it has become known that Valkyrie Investments from Delaware (USA) has done the same. Analysts are already estimating multibillion-dollar investment volumes in the event of active development of the spot market, and the exchange rate dynamics of bitcoin itself in this case. This further stimulates interest in cryptocurrencies.

But, by the way, BlackRock is not the only one. Recently, the German giant Deutsche Bank applied for a license from local regulators to provide a service for the storage of digital assets, including cryptocurrencies. It also motivates serious investors to work with bitcoin, ether, and other coins.

An additional positive factor in the growth of the bitcoin exchange rate was the launch of a new crypto exchange this week - EDX Markets (EDXM). Its launch was announced back in September 2022, and now it has already begun to service transactions. Among the founders of the platform are such financial giants as Charles Schwab, Fidelity Digital Assets, and Citadel Securities. Other co-investors included Miami International Holdings, DV Crypto, GTS, GSR Markets LTD, and HRT Technology, and the exchange was supported by such blockchain projects as Filecoin and LayerZero.

EDX Markets currently offers trading in Bitcoin, Ethereum, Litecoin, and Bitcoin Cash. Yet, according to a new principle: retail investors will not trade directly, but through brokers. The assets themselves are not put up on the platform, only the prices are agreed upon and transactions are executed. While on other exchanges, digital assets are usually placed in electronic wallets.

This is only the beginning, and the project is promised to be developed. EDX Markets' management announced the creation of its own clearing structure - EDX Clearing. For settlement of transactions, which is expected to help not only speed up the flow of funds, but also minimize risks for investors, as well as reduce prices by increasing competition. It is clear that the development of trading on EDXM is approached thoroughly, and it is also nice to see that the creators manage to attract investors who are actively involved and allow the platform to develop. This, of course, confirms EDX Markets’ serious prospects.

Another important nuance that is also driving the rise in the price of cryptocurrencies and bitcoin in particular is the change in the monetary policy of the US Federal Reserve. In June 2023, for the first time in a long time, the Fed refused to raise its rates, leaving them in the range of 5-5.25% per annum. Prior to that, they had been raised 10 times to curb US inflation and maintain investor interest in the dollar: from March 2022, rates rose by 5% at once, while before that they were in the range of 0-0.25%. Now the regulator has decided to stop, telling the public that the rate of retail price growth has begun to slow. But it also disappointed investors who had invested in dollar assets and now find themselves in a kind of stupor. This also motivated people to transfer at least some of their funds to the dynamic cryptocurrency market, which promises more substantial earnings.

I think this is just the beginning. New projects and policies of global central banks will continue to motivate investment in bitcoin and other coins. Therefore, their prices will continue to rise.