El Salvador adoption sparks Bitcoin boost – is a return $40k in sight?

Crypto at a glance

Bitcoin roused from its slumber yesterday, charging back from a low of $32,475 to more than $37k in a matter of hours. It’s currently trading at just below $37k, up eight per cent over the last 24 hours. It’s a pattern we’ve seen a lot in recent weeks, with a mid-week rally being followed by a sell off over the weekend. Will this week be different?

The latest price move certainly seems to have a lot more behind it, supercharged by the news that El Salvador has made the leading cryptocurrency legal tender. Subsequent tweets from the country’s president, Nayib Bukele have also made clear that we have another Michael Saylor in the making. And this time, he’s president of a bona fide country. What impact could national adoption and such a powerful advocate have on the space?

All eyes now are on whether other Latin American countries make a similar move, with Twitter commentators excitedly pointing to bullish statements from politicians in Argentina, Brazil, Mexico, Panama, and Paraguay. It’s certainly providing a timely antidote to less good news out of China, where miners in Qinghai province have received shutdown orders and some blockchain keywords across the country have been banned. Is the community numb to the country’s nonsense now?

The focus on Bitcoin means that, for the first time in a while, it’s largely out there alone, with alt coins remaining generally stagnant over the last 24 hours. Bitcoin’s market dominance has now recovered to around 44 per cent, having languished at 42 per cent since late May. Only Polkadot (DOT) has seen any significant move, rising 12 per cent to just below $24.

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Total crypto market cap

The total capitalisation of the entire cryptocurrency market at time of writing is currently $1,601,885,464,113.

What Bitcoin did yesterday

We closed yesterday, June 9 2021, at a price of $37,345.12, up from $33,472.63 the day before.

The daily high yesterday was $37,537.37 and the daily low was $32,475.87.

This time last year, the price of bitcoin closed the day at $9,870.09. In 2019, it closed at $8,000.33.

Bitcoin market capitalisation

Bitcoin’s market capitalisation at time of writing is $690.54 billion. To put it into context, the market cap of gold is $11.98 trillion and Facebook is $936.41 billion.

Bitcoin volume

The total spot trading volume reported by all exchanges over the last 24 hours was $50,778,692,679, up from $47,806,820,106 yesterday. High volumes can indicate that a significant price movement has stronger support and is more likely to be sustained.

Volatility

The price volatility of Bitcoin over the last 30 days is 97.68%.

Fear and Greed Index

Market sentiment today is 21.

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Bitcoin’s market dominance

Bitcoin’s market dominance today is 43.68, Its lowest ever recorded dominance was 37.09 on January 8 2018.

Relative Strength Index (RSI)

The daily RSI is currently 43.95. Values of 70 or above indicate that an asset is becoming overbought and may be primed for a trend reversal or experience a correction in price – an RSI reading of 30 or below indicates an oversold or undervalued condition.

Convince your Nan: Soundbite of the day

“Bitcoin being classed as legal tender in El Salvador means that every-day Salvadorians can easily make cross border payments without having to rely on the USD. Over 20% of GDP was made up from remittances back to El Salvador last year and therefore if El Salvador can attract even a small amount of crypto economic activity to the country, it could be huge. We may even see crypto-native companies setting up in El Salvador now that banking relationships in the country will be easier.

“Bitcoin, Ethereum and other cryptocurrencies are destined for the balance sheets of more countries, central banks and corporations. El Salvador was the first country to make bitcoin legal tender and the floodgates are now open.”

– Ross Middleton, chief financial officer of DeversiFi

What they said yesterday

El Salvador…

Incentivises…

Another kind of volcano…

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Cautionary Notes

It’s definitely tempting to get swept up in the excitement, but please heed these words of caution: Do your own research, only invest what you can afford, and make good decisions. The indicators contained in this article will hopefully help in this. Remember though, the content of this article is for information purposes only and is not investment advice or any form of recommendation or invitation. City AM, Crypto AM and Luno always advise you to obtain your own independent financial advice before investing or trading in cryptocurrency.

All information is correct as of 08:30am GMT.