Bitcoin is seeing minor price recovery, but no bottom in sight yet
The price of bitcoin is slowly recovering from the recent selloff thanks to the FTX fallout, but picking a bottom is akin to throwing darts at a board blindfolded.
As Coindesk reported, there are also encouraging signs in the overall economic climate that could lead to a return to risk-on sentiment to help prop up the leading cryptocurrency. For example, the US central bank can put the brakes on interest rate hikes as early as this month.
Meanwhile, bitcoin’s price recently reached above the $17,000 mark after falling below $16,000 in November. Just before the collapse of the cryptocurrency exchange FTX, Bitcoin was right around the $21,000 mark.
The latest drop has yet to confirm whether bitcoin has truly bottomed out or not. As such, investors may want to tread lightly or consider other options to prepare for further downward price movements.
“As we have seen three attempts this year that ultimately failed, we need to wait for bitcoin prices to trade above their 21-week moving average ($20,851) to demand a sustainable rally and a cyclical low,” head Markus Thielen . of research and strategy at crypto service provider Matrixport, said.
Play a Bitcoin Recovery With Futures
If bitcoin can recover from the current price decline, there are other options to consider than allocating investment capital to the cryptocurrency itself. For example, investors can bet on bitcoin futures via an exchange-traded fund (ETF) on a regulated exchange, such as ProShares Bitcoin Strategy ETF (BITO).
BITO provides the gateway for investors who want crypto exposure to diversify their assets, but still want to remain within the safe confines of a regulated market. As the crypto market grows and the government looks to strengthen its regulatory structure, BITO can provide investors with the regulated crypto exposure they want.
In addition, the fund is actively managed, giving investors peace of mind knowing that their investments are in the hands of experienced portfolio managers. Bitcoin can be a volatile asset, and active management can make portfolio changes on the fly when market conditions warrant an adjustment.
BITO is an alternative to get decentralized exposure without direct access to the asset. Given the current economic uncertainty and the recent fallout from the FTX collapse, now might be a good time to do so.
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