Bitcoin price is shocking the market by trading at different levels on some exchanges. During the night, the price of BTC jumped on Bitfinex’s perpetual swap market. The price of the largest cryptocurrency by market cap has soared above $56,000. Here are the details…
Bitcoin price jumps on Bitfinex
Bitcoin price briefly rose above $56,000 earlier today on Bitfinex’s perpetual market. Thus, it created shock waves in the crypto market. Bitfinex’s trading volume on the BTC-PERP market increased to 322 BTC ($9.1 million) for two minutes. Volume in the perpetual swap market made up about 25 percent of the daily volume in the trading pair. In response to the sudden price increase, Bitfinex CTO Paolo Ardoino made a statement. He explained that what caused this was “current low liquidity.” However, he assured market participants that the system was working as expected. It assured that the matching engine was processing all orders correctly.
https://twitter.com/paoloardoino/status/1653425605260476416
Perpetual swaps, such as the BTC-PERP market on Bitfinex, as we’ve reported on Kriptokoin.com, are a derivatives contract that allows investors to speculate on the future price of an asset like Bitcoin without expiration date. These contracts allow both long and short positions, allowing traders to profit from price increases and decreases. In addition, funding rates are used to keep the swap price close to the underlying asset. Traders who hold positions in the direction of the funding rate pay the traders on the opposite side, encouraging the market to remain in balance.
Meanwhile, the overall market price of Bitcoin also rose. It reached its intraday high of $28,764 on the Bitstamp exchange. The recent drop in the shares of embattled US regional banks seems to have contributed to Bitcoin’s recovery.
Biggest BTC investor announces profit
In other news, MicroStrategy, the largest publicly traded Bitcoin owner, announced its first profit in nine quarters after claiming a tax benefit on its massive Bitcoin holdings. It reported net income of $461 million, or $31.79 per share, in the first quarter, compared to a loss a year ago. The 72 percent increase in Bitcoin price in the last quarter was effective in the company’s earnings. This allowed MicroStrategy to essentially lower a reserve for crypto tied to impairment fees. This resulted in a one-time tax benefit of $453.2 million.
Michael Saylor, co-founder and chief executive officer of MicroStrategy, saw his $4 billion investment in Bitcoin become profitable again as the value of BTC exceeded the average purchase price. In early April, Bitcoin moved just above MicroStrategy’s purchase price of $29,803. The coin has surpassed $30,000. As a result, the company did not have to devalue its Bitcoin holdings. Saylor started buying Bitcoin in 2020 to reduce the amount of cash the company has. According to its financial statements, MicroStrategy had a total of 140,000 Bitcoins at the end of March. During the quarter, the company added 7,500 Bitcoins for approximately $179 million.
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