Here’s why the market did so well.
Bitcoin’s Big Gains
This was one of the best months for Bitcoin in recent history. Over the course of May, Bitcoin’s market value went up by approximately 60%. This brought the price of Bitcoin above $8400—a price that Bitcoin hasn’t seen since mid-2018. This substantial price pump also drove up the market cap of Bitcoin, which is now approximately $150 billion.
On May 31st, Bitcoin’s daily trading volume was $27 billion, which indicates that Bitcoin is in high demand among investors. Many analysts believe that Bakkt, a highly-anticipated Bitcoin trading platform, drove up demand this month by announcing plans to begin user testing. However, there are other possibilities as well.
Mati Greenspan of eToro believes that investors are stocking up on Bitcoin due to an upcoming “halvening,” which will reduce miner rewards and slow down the creation of new Bitcoin. Although the halvening is one year away, similar price rallies have occurred well in advance of other halvenings, so this phenomenon could be driving up demand.
Litecoin Leaps Upward
Litecoin performed almost as well as Bitcoin this month, as its price gained 50% in May. This puts Litecoin’s price at $110 and sets its market cap at $6.8 billion. On May 31st, Litecoin’s daily trading volume was $4.4 billion, which suggests that Litecoin is in high demand among crypto investors.
Like all major coins, Litecoin generally stays in line with Bitcoin’s price, more or less, and no major events seem to have affected Litecoin’s price this month. That said, Litecoin is set to undergo its own halvening in August, which means that the coin’s price could experience significant changes in the coming months.
This was one of the best months for the crypto market in recent history. Bitcoin’s 60% price increase also looks good next to its performance from last month: in April, its price increased by about 30%. That makes two very good months in a row, and the next few weeks will provide clues about whether the upward price trend will continue throughout June.
Disclaimer: information contained herein is provided without considering your personal circumstances, therefore should not be construed as financial advice, investment recommendation or an offer of, or solicitation for, any transactions in cryptocurrencies.