Bitcoin now is trading at $29,591.43 after hitting $30k. This price movement may be attributed to different factors that include,
- FOMO
- Price movement contrary to people's expectations
- Stablecoin retail money impact
coinmarketcap
The Shanghai update is believed to have played a role in the spike of Bitcoin price initially due to the fact that it unlocked staked Ethereum on the network and increased market volatility and risk demand.
Fear of Missing Out (FOMO) plays a significant part in the space of crypto investments.
As the prices soar, an influx of investors comes in for the eagerness to profit from the upward trend. This influx of new investors propel the prices even higher.
However, this is something that could cause the market to peak when the influx of buyers fall back and the prices start go through corrections.
The recent surge in Bitcoin price of $30k might have been caused partially by FOMO as the successful transition of Ethereum was perceived as a favorable indication for the wider market.
One of the captivating side of the market dynamics us that the prices frequently moves in opposite of the expectations of the crowd.
This is probably why the Bitcoin price dropped reacting to people's optimistic expectations after Ethereum unlock as this move was thought by large cohort of influencers to be marking the beginning of a long term bull market.
The Ethereum update happened recently may have contributed to the price of Bitcoin go up by encouraging stablecoins retail investments. However as the market adjusts and these investments stabilize, we may see Bitcoin price natural correction as we have seen it going below $30k.
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