Bitcoin has been surging, breaking through the critical resistance level of $71,000 in a recent rally. This surge in Bitcoin has also caused a ripple effect in the world of altcoins.
Recently, Bitcoin (BTC) soared above $71,000, edging closer to its all-time high of $73,628. This surge comes just before the upcoming Federal Reserve meeting next week, with investors expecting potential rate cuts later in the year.
Recent economic data indicates a slowdown in inflation and a weakening job market in the US, strengthening the argument for a rate cut by the Fed. These factors typically play a role in the Fed’s monetary policy decisions.
Lower interest rates are often viewed as favorable for speculative assets like Bitcoin. Tom Couture, a digital asset strategist at Fundstrat Global Advisors, expressed this sentiment in a recent investor note, stating, “Crypto assets are responding positively to the decline in rates.”
Another driving force behind Bitcoin’s upward momentum is the substantial inflow of funds into spot Bitcoin Exchange-Traded Funds (ETFs). Blockchain researcher Collin Brown highlighted that spot Bitcoin ETFs saw a massive inflow of $887 million on a particular day, marking one of the highest net inflows since the inception of Bitcoin ETFs.
The total net asset value of BTC spot ETFs now stands at $61.46 billion, with major players such as Grayscale Investments, Fidelity Investments, and BlackRock contributing to this surge in investments. Fidelity’s FBTC led the pack with inflows exceeding $378.7 million, followed by BlackRock’s IBIT at $275 million, and Ark Invest’s ARKB at $138.7 million. Even Grayscale’s GBTC, which initially experienced large outflows, saw an inflow of $28.2 million.
There are several indicators suggesting that Bitcoin could reach a new all-time high soon. The global demand for Bitcoin ETFs is increasing, with countries like Australia and Thailand now offering these investment vehicles. Additionally, the 30-day correlation between Bitcoin and the Nasdaq 100 is currently at its highest since early 2023, indicating that further gains in the Nasdaq 100 could lead to an increase in Bitcoin’s price, which is currently at $70,954.58.
In the broader crypto market, Binance Coin (BNB) surged over 10% in the last 24 hours, reclaiming a market cap above $103 billion. Other cryptocurrencies like Tocoin (TON) and meme coin Shiba Inu (SHIB) also saw significant increases, with SHIB becoming the 11th largest digital asset by market cap.
With positive momentum in the crypto market, the prospect of Bitcoin reaching new heights seems promising. Stay tuned for more updates on Bitcoin and the broader cryptocurrency space.