Bitcoin started October well, without leaving the narrow consolidation range of 18,700 - 19,600. So far, for two weeks now, the technical benchmarks for BTCUSD have not changed: the June low and the resistance of 20,700 serve as distant targets in case of a fall.
Meanwhile, the crypto community is beginning to discuss a future surge in volatility. We will try to understand below what can become its drivers.
Expect a sharp spike in volatility
Cryptocurrency strategist, known under the pseudonym Pentoshi, claims that in a few days the volatility of the main cryptocurrency may increase. He said that he is closely monitoring the volume of bitcoin trading, which is increasing significantly on crypto exchanges.
"Big movement in the next few days after almost a month of horizontal movement. Same chart, high volume on all exchanges except for the big June sale. This is a significant increase."
According to Pentoshi, the increase in BTCUSD trading volume comes as the main cryptocurrency tests its diagonal resistance, which has kept it in a downtrend since November 2021.
"According to Pentoshi, the increase in BTCUSD trading volume comes as the main cryptocurrency tests its diagonal resistance, which has kept it in a downtrend since November 2021."
Last week, Pentoshi predicted that bitcoin could rise to $28,000 as he believes BTC bulls are poised to spark a relief rally. The popular analyst is also looking at the bitcoin dominance chart, which tracks how much of the total cryptocurrency market cap belongs to the top digital asset.
The bullish dominance of BTC suggests that bitcoin is rising faster than other crypto assets, or altcoins are losing value while the leading cryptocurrency is rising. According to Pentoshi, the BTC dominance chart seems to be poised for a big breakthrough.
New Bitcoin-ETF from BlackRock
It is worth noting that this week a surge in volatility is possible amid the release of data on the US labor market. The main cryptocurrency is still reacting to macroeconomic news, although recently the correlation with US stock market sentiment has weakened.
While we wait for the denouement, which is still four days away, we will be distracted by favorable news. An important event was being discussed in the crypto community - BlackRock, the world's largest asset manager, is launching a blockchain exchange-traded fund (ETF) in Europe. The company is working to offer its European institutional clients the same benefits as the ETF launched in America.
Back on September 29, BlackRock announced the launch of iShares Blockchain Technology UCITS ET. It will track the New York Stock Exchange's FactSet Global Blockchain Technologies Limited Index. The index is linked to 35 companies worldwide and is listed on Euronext under the ticker $BLKC.
The global asset management company seems to be taking a positive and strong stance towards cryptocurrencies. BlackRock is quite active in the financial market revolution based on crypto.
Back in August, the company announced the start of a partnership with Coinbase to be able to offer bitcoin trades to its institutional clients. In addition, it allows US institutional clients to invest in BTC through a newly created private trust. Now BlackRock is building a blockchain ETF in Europe.
In the near future, the iShares Blockchain Technology UCITS ETF will provide access to blockchain businesses and crypto businesses. It is expected that 75% of the exposure of the index will come from companies whose core business is in the blockchain-related industry.
This includes cryptocurrency miners as well as exchanges. Companies that contribute to the blockchain ecosystem make up approximately 25% of the total index.
The path from criticism to acceptance
It is worth noting that before this, BlackRock had a more pessimistic view of cryptocurrencies. In 2017, CEO Larry Fink referred to bitcoin as a money laundering index, pointing out that the activities in the Bitcoin network and its price are closely related to money laundering.
However, BlackRock's point of view has changed as a result of the demands of the market and its customers.
As a firm focused on providing clients with long-term financial benefits, BlackRock is betting on the possibility of significant growth in the cryptocurrency market in the long term.
Financial institutions stand for clear rules
After a significant bear market period, October is a month to look forward to. Investors hope that this will lead to new positive developments, especially bullish growth.
Recently, Commodity Futures Trading Commission (CFTC) Chairman Rostin Behnam proposed facilitating the regulation of bitcoin and other cryptocurrencies.
As long as the cryptocurrency market is under control, the director of the CFTC predicts that the price of the main cryptocurrency will continue to rise in the near future. Financial institutions will be encouraged to invest in digital assets if clear rules are implemented.
On the other hand, many investors just sit and wait for the market to improve. According to the CFTC, the introduction of regulation is an absolutely necessary condition for this. We can only hope that this forecast will be accurate.