Fundstrat founder Thomas Lee, also known to the cryptocurrency community as Tom Lee, has shown his interest over the recent price recovery made by bitcoin in the past week from its drop.
On July 27, after the denial of the Winklevoss bitcoin ETF by the U.S. Securities and Exchange Commission (SEC), the price of bitcoin dropped by over 6 percent, from $8,300 to $7,800 within a three-hour period.
However, within a day following the decline, the bitcoin price bounced back from $7,800 to $8,250. Interestingly, the increase in volume backed by the demand for bitcoin on July 2018 boosted the price of bitcoin to rise by 5 percent in a short period of time.
According to Lee, the ability of bitcoin to recovery rapidly within a short period of time signifies a positive change in the cryptocurrency market. At first, traders in the cryptocurrency were too quick to respond to the rejection of the Winklevoss bitcoin ETF, which was not the ETF the community has hoped for.
“It’s a sign of a positive change in crypto that bitcoin has essentially shrugged off the Winklevoss ETF rejection. If this took place in April-June (more bearish period), the crypto market would have seen a sizable sell-off. In short, affirming why technical improving,” Lee said.
The price of bitcoin since July 22 has risen from $7,200 to $8,300 reaching $8,500 on July 25. In a just over a week, the price of bitcoin has increased by more than 15 percent and sustained the $8,200 level for five consecutive.
For analysts, this rapid increase is thanks to the increase in volume and price of Bitcoin due to the high expectation of the cryptocurrency community regarding the approval of the first bitcoin exchange-traded fund (ETF), which according to eToro CEO Yoni Assis will be an epic regulatory change initiated by the U.S. government.
“There are many existing alternatives for an ETF, I think having institutional demand flow through those is as important. ETF is simply a regulatory signal from the SEC it’s a valid asset class,” Assia explained.