Bitcoin Price Movement, Korean Won's Lead, Hong Kong ETFs

London: 17 April 2024 (TraderMade): In a whirlwind of market movements, the crypto landscape is evolving rapidly. Bitcoin's price is in focus, the South Korean Won emerges as a new crypto powerhouse, and Hong Kong prepares for the debut of Bitcoin and Ethereum ETFs.

Let's dive into the key insights and implications of these developments.

Key Takeaways

• A breach is possible if Bitcoin falls below $60,000, with support suggesting a decline to $54,000-$58,000.
• Analysts dismiss a drop to $40,000, citing low liquidity and a potential short squeeze if the price hits $72,000.
• In Q1 2024, the South Korean Won led crypto trades with a volume of $456 billion, surpassing the US Dollar.
• Hong Kong is poised for Bitcoin and Ethereum ETF debuts, with an estimated demand of up to $25 billion from mainland China.
• Despite challenges, Hong Kong's ETF debut is positive for Bitcoin, boosting adoption through new investment channels.

Bitcoin Price Analysis: What's Next For BTC Price?

Bitcoin has been oscillating between $50,000 and $70,000, leaving traders and investors eagerly awaiting its next move. A recent analysis by AMcrypto sheds light on the potential future movements of Bitcoin's price.

Understanding Market Dynamics

The analyst stressed the importance of understanding the market structure and pointed out that a break below $60,000 could signify a breach, with less liquidity available below this level.

Despite some bearish predictions, the analyst argued against Bitcoin dropping to $40,000, citing insufficient liquidity and the potential for a short squeeze if the price reaches $72,000.

Comparison to Previous Bullish Runs

When comparing the current market to the bullish run of 2021, the analyst suggested that it is likely at a similar phase to September of that year. Daily timeframe analysis indicates that a drop below $60,000 could lead to a decline to around $54,000 to $58,000.

However, a single red candle this month shouldn't overly concern traders, as the market could still shift, potentially turning into a green candle by the end of the month.

South Korean Won Emerges as Crypto Trading Leader

In the first quarter of 2024, the South Korean Won emerged as the leading currency for cryptocurrency trades globally, with a trade volume of $456 billion, surpassing the $445 billion traded in US dollars.

This surge reflects the growing speculative demand for "risky crypto assets" within South Korea and the fierce competition among local digital currency exchanges. Smaller exchanges, such as Bithumb and Korbit, have recently offered zero-fee trading promotions, challenging Upbit's dominance of over 80% of the local spot trading market.

Regulatory Landscape in South Korea

South Korea's regulatory approach to digital currency remains complex. Ongoing legal proceedings against Do Kwon, the founder of TerraForm Labs, illustrate the government's role in enforcing compliance within the industry.

South Korea's Financial Supervisory Service (FSS) Chairman, Lee Bok-hyun, is scheduled to meet with the United States SEC Chairman, Gary Gensler, in May to discuss the classification of non-fungible tokens (NFTs) and the approval of spot Bitcoin ETFs.

Hong Kong Prepares for ETF Debut

Hong Kong may see the debut of Bitcoin and Ethereum ETFs following regulatory approval as early as next week.

Analysts caution that the immediate impact of these ETFs might be limited due to market size, investor restrictions, and less competitive structures compared to the US market.

Matrixport suggested that the potential approval of Hong Kong-listed spot Bitcoin ETFs could generate up to $25 billion in demand from mainland China.

However, Bloomberg ETF analyst Eric Balchunas believes this estimate to be overly optimistic, estimating that they will be lucky to get $500m due to the nascent state of Hong Kong's ETF market, which currently holds only $50 billion in assets.

Challenges Ahead for Hong Kong ETFs

Challenges such as limited investment pools, small issuers, wider bid-ask spreads, and higher management fees ranging from 1-2% also hinder the success of these ETFs.

Despite these challenges, the debut of Bitcoin and Ethereum ETFs in Hong Kong is still seen as positive for Bitcoin in the long run, promoting Bitcoin adoption by providing additional investment channels.

Conclusion

The crypto market is at a pivotal point, with Bitcoin's price fluctuating between $50,000 and $70,000. While the current outlook may not be overwhelmingly positive, a market surprise is always possible.

With the South Korean Won emerging as the leading currency for cryptocurrency trades and the potential debut of Bitcoin and Ethereum ETFs in Hong Kong, the crypto landscape continues to evolve rapidly.