Feb 01, 2022 07:15
Big news for the cryptocurrency community! After months of confusion, India, which was one of the countries that banned cryptocurrencies, submits to reality and backs off from its decision. News surfaced about how India legalized cryptocurrencies by imposing taxes. This gives total legitimacy to cryptos and eliminates any confusion around the topic among crypto users. On the other hand, the crypto market started to move upwards, with Bitcoin specifically getting closer to 40K. Where will the Bitcoin price reach? Let's find all the details in this article.
India Legalized Cryptocurrencies!
Back in 2021, the cryptocurrency market fell by more than 15% when India issued a statement banning cryptocurrencies. Today in 2022, India backed off its earlier statement. The country decided to tax crypto activities and put a crypto income tax of 30%.
Not only did they embrace cryptocurrencies, but India also decided to digitize the Rupee and introduce a new digital currency starting April 1, 2022. This news definitely took a positive effect on the cryptocurrency market which saw currently a rise of more than 5% on an aggregate level.
Why was the crash when cryptos were banned higher than the positive news when cryptos were adopted? Well, the crypto market is still considered in a bearish trend. Buyers are still worried about whether they should enter the market or wait for further adjustments. Once the buying volume increases, the market will in turn move higher.
When will Bitcoin Price reach 40K?
With the recent good technical formation of an uptrend and excellent fundamentals thanks to India, the crypto market is in a good place. In figure 1, we can see how Bitcoin retraced from the low of $33,000 and is since then on a healthy uptrend. The $39,000 price was reached earlier today, but prices are expected to consolidate before reaching 40K again. Once we breach this valuation, prices need to remain higher than $40,000 in order to break the bearish market trend. This way, crypto investors will gain confidence in this comeback, and in turn swap their stablecoins to cryptos again.
Fig.1 BTC/USD 2-hours chart showing BTC's uptrend from its low -
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The Cryptocurrency Market is UP
In the past 24 hours, most cryptocurrencies increased in valuations. In figure 2, we can see the chart of the entire cryptocurrency market cap going up. The pattern is very similar to Bitcoin's price-action. In fact, Bitcoin still has a dominance of around 42%. That's why it's natural to see a highly correlated chart between the entire crypto market in general and Bitcoin in specific.
Fig.2 Total Crypto cap in USD 4-hours chart -
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