The cryptocurrency market experienced a rollercoaster ride earlier this week, with Bitcoin dipping below $30,300 and Ether slipping under $1,900. However, momentum quickly shifted on Thursday as both assets rebounded—BTC surged to $31,480 and ETH climbed toward $1,960 before pulling back slightly.
At the time of writing, Bitcoin is trading at $31,220, while Ether holds steady at $1,940, according to CoinGecko. This volatility was triggered by the release of the June Federal Open Market Committee (FOMC) meeting minutes, which revealed that most Fed officials believe additional interest rate hikes in 2023 are likely. Some even support a hike as early as June, reinforcing a hawkish monetary stance that weighed on risk assets—including both crypto and equities—especially ahead of the crucial U.S. jobs report.
Despite macroeconomic headwinds, recent bank stress tests indicate financial institutions are resilient enough to withstand a severe downturn while continuing to lend. This resilience may embolden the Fed to pursue aggressive rate hikes to combat inflation without tipping the economy into recession.
Market analyst Jim Wyckoff from Kitco noted that Bitcoin’s recent dip occurred during the July 4 holiday, contributing to weaker futures pricing. However, he remains optimistic:
“The current pause and choppy trading at higher price levels is not bearish and suggests the bulls are storing up energy for another push higher in the near term.”
Technically, Bitcoin faces resistance near $34,400. A breakout could see it test $35,000 soon, with stronger resistance around $37,000. Clearing that level might open the path toward $48,000—but such rapid gains could also invite a correction, potentially retesting support below $30,000.
Bullish Signals in Derivatives and Institutional Activity
Despite initial sector-wide weakness, derivatives markets are flashing bullish signals. Bitcoin futures open interest (OI) now exceeds $12 billion—up from $10.4 billion in early June—according to Glassnode. Though slightly off its June 29 peak of $13.4 billion, the rising OI reflects growing trader confidence.
Institutional participation is also heating up. CCData reports that June marked the Chicago Mercantile Exchange’s (CME) strongest month for Bitcoin futures volume, jumping 28.6% to $37.9 billion. Ethereum-based futures saw a 10.8% increase, with over 97,000 contracts traded. Combined, BTC- and ETH-backed products recorded a 24.6% volume surge, totaling $46.8 billion—the highest since May 2022.
Bitcoin’s rally began in mid-June, driven by a wave of spot Bitcoin ETF filings and sustained by improving global sentiment. China’s unveiling of a quantitative easing program added tailwinds, while regulatory clarity in Singapore, South Korea, and Thailand boosted investor confidence.
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Notably, Thailand’s Prime Minister hopeful Pita Limjaroenrat disclosed holdings in multiple cryptocurrencies, including BTC, ETH, BNB, and ADA—highlighting growing political acceptance of digital assets.
A major catalyst came from BlackRock CEO Larry Fink, who stated in a recent interview that crypto “could revolutionize finance.” He emphasized Bitcoin’s role as a borderless hedge against currency devaluation and inflation, calling it an “international asset” unbound by any single nation’s monetary policy.
While Bitcoin recovered, many altcoins faced selling pressure. Kaspa led the losses with an 8.3% drop in 24 hours, followed by Radix, Fantom, Stellar, Gate, Woo Network, and Mina.
Major Forks Ride the Momentum Wave
Among the top gainers over the past day are FSX (+8.6%), SOL (+7.6%), CMOP (+5.3%), PEPE (+5.1%), Neo (+4.2%), Monero (+3.7%), and Maker (+3%). The total crypto market cap rose 2% to $1.256 trillion—but the real leaders are forks of major blockchains.
Bitcoin Cash (BCH) has surged 180% over the past 15 days. On Thursday alone, it gained 11.5%, trading at $295.60. BCH is also up 8.8% against BTC, with trading volume exploding 143.9% to $1.18 billion. This rally coincided with increased institutional attention and higher BCH volumes on South Korean exchanges.
The launch of EDX Markets—a platform backed by Citadel Securities, Fidelity Digital Assets, and Charles Schwab—also supported BCH adoption. The exchange lists BCH alongside BTC, ETH, and LTC.
BCH’s rise forced short sellers to liquidate positions en masse. Coinalyze data shows over $25 million in cumulative losses on BCH futures last week as the price approached $320. Funding rates have since turned negative across exchanges, indicating shorts are now paying longs to maintain positions.
Similarly, Bitcoin SV (BSV) jumped 125% between June 20 and July 1. Currently trading just above $46, BSV is up 9.5% against USD and 6.9% against BTC, with volume rising 12.3% to $40.6 million.
Ethereum Classic (ETC) Joins the Rally
Ethereum Classic (ETC)—the 26th largest cryptocurrency by market cap at $2.8 billion—is also gaining traction. At press time, ETC trades at $19.81, up 4.1% against USD, 1.6% against BTC, and 2.38% against ETH. Volume increased marginally by 0.3% to $140 million.
Over the past week, ETC gained 9%, and 15.5% in two weeks. While its 2023 performance stands at +25.73%, it remains far from its May 2021 all-time high of $167—a peak from which it has lost 88.14%. For most of this year, ETC has traded between $15 and $24.
Like BCH and BSV riding Bitcoin’s coattails, ETC’s rise parallels Ethereum’s strong year-to-date performance (+62%). However, Bitcoin’s 86.4% YTD gain pales compared to BCH’s 205.7% surge—suggesting fork tokens can outperform their parent chains during bullish cycles.
Origins and Philosophy of Ethereum Classic
ETC emerged in 2016 when Ethereum split following a contentious decision to reverse transactions after The DAO hack, one of the largest decentralized crowdfunding efforts at the time. The attack drained approximately 11 million ETH from over 18,000 investors.
The community split: one faction supported a hard fork to recover funds (leading to today’s Ethereum), while the other upheld the principle that “Code is Law,” refusing to alter the blockchain’s history. The latter continued on the original chain—now known as Ethereum Classic.
Holders of ETH at the time received an equal amount of ETC for free—a common practice during hard forks.
Monetary Policy and Security Challenges
Unlike Ethereum—which has no hard supply cap—Ethereum Classic adopted a deflationary monetary policy with a fixed supply cap of 210.7 million ETC. Block rewards decrease by 20% every 5 million blocks, making ETC increasingly scarce over time.
This design aims to enhance its value as a long-term store of value, similar to Bitcoin’s scarcity model.
However, ETC faces ongoing security concerns. In August 2020, it suffered three separate 51% attacks, where malicious actors gained majority control of its Proof-of-Work network to double-spend coins.
Terry Culver, CEO of ETC Labs, acknowledged that such attacks are a “universal problem” for PoW chains but introduced defensive mining measures to improve resilience.
Despite periodic price rallies during bullish markets, Ethereum Classic struggles with adoption. Its ecosystem lacks significant decentralized applications (dApps), developer activity remains limited, and user engagement lags far behind Ethereum.
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Outlook for ETC in July
ETC ended June with a solid 13% price increase. If bullish momentum continues into July—fueled by broader market optimism or renewed interest in forked assets—it could climb further.
On the flip side, increased selling pressure could push prices down to the $18 support level.
Frequently Asked Questions (FAQ)
Q: What caused the Ethereum Classic (ETC) fork?
A: The fork occurred in 2016 after a hack on The DAO project led to a community split over whether to reverse transactions via a hard fork. Those opposing intervention continued on the original chain—Ethereum Classic.
Q: Is Ethereum Classic a good investment?
A: ETC offers scarcity through its capped supply and deflationary issuance model. However, limited adoption and security risks mean it carries higher risk than larger smart contract platforms like Ethereum.
Q: How does ETC differ from ETH?
A: ETH moved to Proof-of-Stake and has no supply cap; ETC remains Proof-of-Work with a hard cap of 210.7 million tokens and adheres strictly to immutability principles.
Q: Can ETC reach new all-time highs?
A: Given its current price is less than 12% of its ATH ($167), a new high would require massive adoption growth and market-wide bullishness far beyond today’s levels.
Q: Why are Bitcoin forks like BCH and BSV surging?
A: Increased institutional support (e.g., EDX Markets), rising trading volumes on key exchanges like South Korean platforms, and speculative momentum are driving recent gains.
Q: Should I buy ETC now?
A: Consider your risk tolerance and investment goals. ETC may appeal to those who value decentralization and immutability—but it lacks the ecosystem strength of top-tier blockchains.
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