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The cryptocurrency market is setting new records again as investors prepare for Coinbase’s direct listing tomorrow.
The combined value of digital assets passed $2.1 trillion for the first time ever last night, according to CoinMarketCap. It’s up about 17 percent in the last month and has more than doubled since first crossing the trillion-dollar threshold on January 7.
Cryptocurrency exchange Coinbase (COIN) is going public on the Nasdaq tomorrow. Wall Street expects a valuation of about $100 billion, ranking it alongside major companies like Target (TGT) and CVS Health (CVS). Many expects see the COIN providing a further boost of confidence in the sector.
“The Coinbase IPO is really going to shake things up,” blockchain consultant Gianni D’Alerta said on The Market Today. “This is an opportunity for people to see that crypto’s not going anywhere.”
It comes at an interesting time because just today Bank of America reported that 74 percent of professional asset managers believe Bitcoin is in a bubble. While that may sound negative, surveys can often be contrary indicators because they reflect what investors currently own (or don’t own). In that case, it may suggest they own little Bitcoin.
The big question now is whether they will start to come off the fence and buy. BTCUSD has remained in a tight around $60,000 since late February. It’s made lower highs during that time and remained above its 50-day simple moving average. Chart watchers may consider that a sign that the bullish trend in place since last summer remains in effect.
Ethereum (ETHUSD), the No. 2 cryptocurrency by market cap, also surged past $2,300 for the first time. It has spent the month consolidating above its old high of $2,000 as investors worry about high transaction fees on its network.
However, those concerns may have peaked for now because the community just announced its “Berlin” upgrade will go live tomorrow. While this fork includes some minor changes, it demonstrated that developers remain on track for the bigger “London” upgrade in July. That one will include EIP-1559, pushing Ethereum closer to a deflationary supply model. In other words, scarcity would increase as it becomes more usable as a decentralized financial network.
Ripple (XRPUSD) was another positive catalyst today. The cryptocurrency crashed in December after the Securities and Exchange Commission filed a complaint against its creator. But this week a Federal Judge blocked part of the government’s case against the company, launching XRPUSD to its highest level in over three years.
In conclusion, cryptocurrencies have been out of the spotlight recently. But now they’re showing signs of continuing higher amid events like COIN’s IPO.
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