Bitcoin traders are exhibiting a change in attention from the halving event to wider market threats. The mood now seems to be more impacted by outside variables, such as changes in United States regulations, uncertainty in the world economy, and patterns in the conventional financial markets.

In an effort to reduce risk, some traders are also looking at alternate investment options available inside the cryptocurrency ecosystem, such as Non-Fungible Tokens (NFTs) and Decentralized Finance (DeFi) platforms. Due to the constantly changing cryptocurrency ecosystem, bitcoin traders are focusing more on wider market concerns rather than the impending halving.

Because of the increasing scarcity resulting from this loss in supply, price rises have historically been linked to it. Amid the hope that the impending halving is expected to have an impact, many Bitcoin traders are more interested in larger market patterns than in the possible consequences of the move.

SEC Continues to Investigate Self-Acclaimed Cryptocurrency Securities 

This trend suggests that institutional investment may soon enter the Bitcoin market and has reignited interest in it. It provides access to a wider pool of investors and denotes a degree of regulatory approval. Despite the impending halving, this event has given Bitcoin traders a sense of stability and confidence.

The bigger concerns that could affect the cryptocurrency market are becoming more apparent to Bitcoin dealers. With the growing correlation between cryptocurrencies and conventional financial markets, traders are keeping a tight eye on these outside variables. Uncertainty has also been increased by the continued regulatory examination of cryptocurrencies in several nations, most notably the United States.

Concerns concerning the classification of different cryptocurrencies as securities are being raised by the United States Securities and Exchange Commission (SEC), which is still investigating their status. Because of this uncertainty, traders are becoming more cautious and putting more of an emphasis on risk management than on speculative gains.

Traders Look For Alternate Investment Options, Woos DeFi and NFTs

Bitcoin traders are adjusting their trading tactics to be more measured in light of the wider market concerns. Many are introducing stablecoins and other cryptocurrencies that are less susceptible to particular governmental pressures into their portfolios in an effort to diversify.

Bitcoin’s recent recovery has been fueled by optimism over United States regulatory approval for spot Bitcoin ETFs, even if the halving event is still a significant milestone with possible price consequences. 

The recent bitcoin recovery is attributed to the excitement surrounding the approval of the spot BTC Exchange Traded Funds (ETFs) by the United States Security and Exchange Commission (SEC). The spot BTC ETF influence is the reason behind its major price recovery from its previous price crash in 2022.

Cryptocurrency Industry Expects More Regulatory Changes

Bitcoin had gained by 1.2% on Monday last week, at 1415 GMT, after which it gained slightly by 3.4% on Monday (this week), briefly struggling for direction for the first time after hitting  $73,794 early last month. According to the senior trader at Zodiac Markets, Standard Chartered’s cryptocurrency section, the unfolding global geopolitical events like the tension in the Middle East have also affected the halving.

However, an ease in the tension might as well add a positive trend. eToro’s Global Markets Strategist, Ben Laidler, while speaking to the CAN media platform, said that Bitcoin is currently interested in (what he termed) “institutionalization.”

Laidler also said he’s expecting some major regulatory changes that could make it easier for financial institutions, central banks, and companies to own BTC. CoinGecko shows that the current cryptocurrency market is valued at $2.5 trillion. However, regulators are warning that the industry would be speculative and possess limited real-world uses in the near future.

The cryptocurrency community is also looking forward to the SEC approving a spot ETF for Ethereum. Meanwhile, Eric Demuth, the CEO of Bitpanda, the Austrian-based cryptocurrency broker, has predicted that the hope of this happening in May is almost impossible.