Last Updated on 2 weeks by Ameer Hamza
It’s a new day for Bitcoin enthusiasts, as the cryptocurrency’s price has surpassed $30,000 for the very first time since June 2022. As the banking turmoil of March subsided, investors’ confidence in the monetary policies of the U.S. central bank increased. By market capitalization, the biggest cryptocurrency was recently up 6.75% in price, trading at $30,237. This is a huge achievement for Bitcoin investors and indicates renewed interest in this digital asset. Bitcoin’s price has certainly been on a wild ride in recent years, surging to new highs in 2017 and then plummeting the next year. Yet, Bitcoin has shown amazing resilience since then, with its value rising back and bringing it closer to prior highs.
The Rise of Bitcoin: What’s Driving the Latest Surge in Cryptocurrency Prices?
Bitcoin last surpassed $30,000 on June 10, as it was on its way down to under $20,000, where it spent much of late 2022 and early 2023. Over the past three weeks, the cryptocurrency hovered around $28,000 as jittery investors weighed the implications of near-bankruptcy, persistent inflationary pressures, and other macroeconomic concerns. Despite these challenges, Bitcoin has still managed to climb over 80% since the start of the year, beginning at approximately $16,600.
The rise in Bitcoin is a sign of bigger improvements for the cryptocurrency sector. The price of Ether, the second-largest cryptocurrency in the world by market capitalization, surged by 3% during the last 24 hours to reach $1,900. Overall, the market value of all cryptocurrencies is $1.28 trillion, a 1.02% increase in the last 24 hours and a -36.34% increase from a year ago.
Analysts attributed the rise to market unrest in the traditional banking sector following the failure of Silicon Valley Bank, the 16th-largest commercial bank in America, and Credit Suisse, the 17th-largest lender in Europe, as well as expectations that the U.S. Federal Reserve would scale back its rate increases, making traditional non-crypto assets less appealing.
Richard Mico, the U.S. CEO of Banxa, a payment-and-compliance infrastructure provider for cryptocurrency, suggests that “it’s evident that the market is pricing in a deceleration in growth and, as a result, a relaxing of monetary policy by the Federal Reserve over the course of 2023.” A look at the bond market reveals that the two-year Treasury note in the U.S. has dropped below 4% from a peak above 5% in early March as traders quickly reversed their forecasts of future Federal Reserve interest rate hikes. Mico noted that there would almost certainly be a significant amount of liquidity put into the market as a result. Bitcoin has already been the best-performing asset in 2023, and it is typically the asset that reacts most swiftly and strongly to these kinds of monetary swings.
The recent surge in Bitcoin’s price above $30,000 after a year-long wait is a promising sign for the cryptocurrency sector. As we move forward, we can expect more changes and fluctuations in the cryptocurrency sector, with Bitcoin being a key player in this dynamic market.