Bitcoin fell below $67,000 this week, sparking a buying frenzy. This was the second largest surge in interest in Bitcoin in the past two months.
What caused such a stir? Perhaps it's FOMO (fear of missing out) or people were simply looking for deals. Or maybe both played a role.
According to blockchain analytics platform Santiment, published on Twitter, the fall in the price of Bitcoin has led to an increase in greed in the market.
Bitcoin's second stop below $67,000 on Thursday saw the second-largest surge in buyer interest in BTC in the last 2 months.
FOMO and greed manifest themselves in two ways:
The price is rising rapidly, and traders want to buy quickly, hoping that prices will continue to rise. This situation was observed on May 20, when Bitcoin restored the price level of $71,000. — Santiment (@santimentfeed) June 14, 2024
Santiment argues that greed and fear of missing out arise in the market only under two conditions. The first is when the price rises sharply and traders want to buy in the hope that prices will continue to rise. The second is when people are looking for great deals.
While FOMO and bargain hunting may be behind the recent Bitcoin buying frenzy, it's worth noting that broader macroeconomic factors are also at play. The price of risky assets such as stocks and cryptocurrencies often faces downward pressure as interest rates rise.
That's because higher interest rates make traditionally safer investments like cash and U.S. Treasuries more attractive. Conversely, investors expect a potential rise in the value of risk assets as the Federal Reserve eventually eases monetary policy.
At the time of writing, the price of BTC is $67,136 as the leading cryptocurrency tries to maintain this price level and get closer to the $70,000 price level again.
Over the past 24 hours, Bitcoin trading volume has decreased by 25.93% and currently stands at $26.6 billion with a market capitalization of $1.322 trillion. Over the past 30 days, Bitcoin has increased by 7.08%, and since June 2023 - by 159.08%.
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