Bitcoin Rallies 17% in a Week – What’s Coming Next?

Key Takeaways: – 

• Rising US Treasury yields and concerns about government defaults have led some analysts to view Bitcoin as a hedge during uncertain times, which could positively affect its price.
• Japan’s new tax amendment, exempting corporations from paying taxes on unrealized gains from their own crypto tokens, is expected to encourage crypto entrepreneurship and enhance cryptocurrency adoption in the country, potentially influencing the global crypto market.
• A South Korean court ruled that Bitcoin loans are not subject to national lending business laws because Bitcoin is not considered real money, highlighting the ongoing legal debates and uncertainties surrounding cryptocurrencies.

Last week’s Bitcoin weekly news highlighted that the whales heavily invested in Bitcoin during the recent decline. BlackRock’s potential ETF was also highlighted as a positive indication. The traders were also expecting a price hike in Bitcoin due to increased Bitcoin dominance.

There are a number of factors involved in Bitcoin’s last week’s price pump. The following Bitcoin news may highlight some facts about why Bitcoin’s price was pumped last week and how it may perform over the coming weeks.

The Impact of Rising US Treasury Yields on Bitcoin

The U.S. government’s default has become hot news this year. But it’s a normal problem that appears every year. The only reason why it has become a trending topic this year is that it’s widely highlighted by the mainstream media. Although the country has historically avoided the default, most people are not concerned about it.

The bond holders are worried about how their lives may be affected if the government couldn’t increase the debt default ceiling. Some analysts think that Bitcoin can be a better alternative to prepare for the impact because Bitcoin has historically acted as a hedge during uncertain times.

Currently, the rising treasury yields show that inflation may remain high over the coming weeks. Similarly, the expectations of a recession are rapidly growing. These factors may positively affect Bitcoin and other cryptocurrencies.

Bitcoin Price Prediction by ChatGPT

ChatGPT is an effective AI tool that can help traders with implementing improved trading strategies. It can be a useful tool for conducting a detailed fundamental analysis of Bitcoin. Similarly, the tool can help with accurate sentiment analysis. However, the tool has some limitations due to which it can’t predict future prices.

Based on the rising adoption rate of Bitcoin, ChatGPT has predicted that the token may make a new all-time high between 2023 and 2024. The tool has mentioned that BTC’s appeal as an inflation hedge can further enhance its adoption rate. However, the token may experience turbulences along the way following government crackdowns and actions.

Japanese Authorities are Encouraging Crypto Entrepreneurship

Previously, Japanese corporations were bound to pay taxes on unrealized gains under the Japanese tax law. The National Tax Agency of Japan has introduced a new amendment giving relaxation to these corporations. This new amendment is supposed to strengthen Japan’s focus on creating a favorable environment for crypto entrepreneurs because these companies won’t have to pay taxes on unrealized gains of their own crypto tokens.

The effect is not just limited to Japan because it will enhance the adoption of cryptocurrencies. Japan is one of the leading countries that have established standards for crypto exchanges. Thus, the country ensures the customer’s protection in case of a crypto scam.

On the other hand, SEC hasn’t yet provided any clear guidance about whether crypto tokens are considered securities or not. Similarly, the country hasn’t yet introduced any particular rules regarding the taxation of tokens issued by a crypto firm. Japan’s proactive approach to crypto regulation can support the mass adoption of cryptocurrencies in the region. And it will eventually influence the crypto market globally.

Bitcoin Isn’t Money – South Korean Court’s Decision

The Seoul High Court’s Civil Division was hearing a case between two anonymous companies regarding interest rate rules for business deals involving cryptocurrencies. The court ruled out that the interest rate rules don’t apply to such deals because Bitcoin isn’t real money. The court stated that Bitcoin loans aren’t subject to national lending business laws because cryptocurrency is not money.

Company B borrowed BTC from Company A, a fintech company, for a duration of three months but failed to repay the loan. Company A changed the interest rate while extending the loan period. Company B considered it a violation of the Interest Limitation Act and the Loan Business Act. So, they filed a lawsuit in the court.

High Court ruled out that it was not a violation of the law. However, Company B can still challenge the verdict at the Supreme Court.

The Impact of Russian News

After weeks of sideways trading, Bitcoin experienced rapid gains during the last week. The traders are still confused about its further price action because the price is still below the resistance zone. Some investors believe that the recent news from Russia has played a vital role in recent price gains.

The bulls have succeeded in defending the $30,000. Once the price breaks out of the resistance, the traders will start using $31,000 as support.

Bitcoin Weekly Technical Analysis

Last week’s Bitcoin Technical Analysis highlighted a triangular pattern on the daily chart. The formation of the inverse head-and-shoulder pattern was also highlighted but the pattern didn’t complete. However, the price broke out of the triangular pattern on Tuesday followed by a significant buying pressure.

Bitcoin is now struggling around the resistance zone where its price got rejected on 14th April and ended up getting stuck in a long sideways channel. Most traders are currently optimistic about Bitcoin’s price. The analysts claim that Bitcoin will break out of this resistance and $31,000 will then act as support.

Some analysts claim that Bitcoin will eventually hit the $35,000 level over the coming days.

Conclusion

Bitcoin’s recent rally of 17% has been driven by factors such as increased investment from whales, positive indications from BlackRock’s potential ETF, and expectations of a price hike due to Bitcoin dominance. Rising US Treasury yields and Japan’s favorable tax amendment for crypto entrepreneurs further contribute to the positive sentiment. However, legal uncertainties and government actions remain potential challenges.