Bitcoin's price has rallied sharply this month — but not for reasons you might think.
The world's largest digital currency has risen more than 12% since the beginning of June. On Wednesday, its priceMarket players have attributed the jump to the news that U.S. asset management giant BlackRock hadWhile that may be part of the reason, the outsized moved can be put down to another factor beyond the news flow surrounding large institutions taking steps to embrace bitcoin or other digital assets.Crypto "market depth" has been sitting at very low levels this year.
"Our analysis of market orders over 5 BTC reveals an aggressive surge in market buying, suggesting large players are seeking to gain exposure to digital assets." That lack of liquidity has in part been driven by the regulatory scrutiny of the crypto industry from U.S. authorities. The Securities and Exchange Commission hasLow liquidity, which has been a feature of the crypto market all year, is also partly behind bitcoin's 80% year-to-date rally.Another notable feature of the current crypto market is the low volumes being traded on exchanges.
That's down markedly from the more than $100 billion of overall trading volume in bitcoin during the peak of the 2021 crypto rally, when bitcoin rose close to an all-time high of nearly $69,000.
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