It's a phenomenal comeback, a rebound that perhaps only bitcoin could execute.
The king of cryptocurrencies this time seems to truly be emerging from the crypto winter -- the several-month sectorwide period of continuous price declines.
For the first time since June, bitcoin prices are trading above $30,000. Bitcoin is up nearly 7% to $30,123.51 in the past 24 hours, according to data firm CoinGecko. That's an increase of almost 9% in the past seven days.
Bitcoin last traded above $30,000 on June 9, 2022. At the time the crypto industry was rocked by a liquidity crunch sparked by the sudden collapse of sister cryptocurrencies Luna and TerraUSD/UST. This failure would lead to the bankruptcy of the Three Arrows Capital hedge fund and the crypto platforms Celsius Network and Voyager Digital.
These cascading bankruptcies had accelerated a drop in the prices of cryptocurrencies in general. This year bitcoin prices are up 82.1%.
Bitcoin's Evangelists Celebrate on Social Media
Bitcoin's revival unsurprisingly was celebrated by its evangelists.
"#Bitcoin is Champion," enthused the billionaire Michael Saylor, whose MicrosStrategy (MSTR) is the company with the most bitcoins on its balance sheet.
"The first thing you buy with #bitcoin is peace of mind," Saylor said.
For the former banker Mike Novogratz, "this has been a #crypto led move."
"The adoption cycle always accelerates when the price goes up and we are seeing that," he told CNBC as bitcoin crossed $30K. "Despite all this regulatory attack, the market is going higher."
"We're having a pretty constructive rally," Novogratz, founder and CEO of crypto investment firm Galaxy Digital (BRPHF) , argued. "The market is pretty certain that [Fed Chairman Jerome] Powell is pretty close to finished. Gold, #Bitcoin, #Ethereum, those assets that will do well in a slowdown are telling us something."
He suggests that the Fed is done raising interest rates.
'Fresh Air After a Cold Winter': YieldApp CEO
Traders are linking bitcoin's recent moves to bets that the Federal Reserve has likely reached the end of its aggressive rate-hike cycle, with just one more increase priced in by ME Group's FedWatch. This comes as central banks worldwide pivot from their recent inflation fights in order to support growth.
"Just as spring brings a renewed sense of energy, the recent surge in bitcoin's price is like a breath of fresh air after a long, cold crypto winter," said Tim Frost, CEO of digital wealth platform Yield App.
"This renewed optimism could be attributed to an anticipated shift in the U.S. Federal Reserve’s monetary policy, which is expected to create a more stable, and hopefully predictable, environment."
He added that the move has led many to speculate whether the far-reaching implications of last November, where bitcoin tumbled as low as $15,000, may have marked the rock-bottom of the current bear market.
"While it’s too early to tell, the recent price action has certainly been a positive sign and reflects growing mainstream acceptance of digital assets," Frost argued.
Some experts point out, however, that the environment for cryptocurrencies is not completely clear. The U.S. Securities and Exchange Commission has launched a major regulatory offensive against the sector.
The SEC has taken on Coinbase (COIN), one of the biggest names in the industry. Last month, the federal agency warned that it may sue the platform because Coinbase is allegedly offering products that should have been registered with the regulator. The company disputes the allegations.
Apart from bitcoin prices, the prices of other cryptocurrencies have also rebounded strongly. Ether, the native token of the ethereum ecosystem, is up nearly 4% to $1,918.89 in the past 24 hours. The entire crypto market is up 5.1% to $1.29 trillion in the past 24 hours.
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