Why Is Bitcoin Up This Week?
Bitcoin’s price at one point on Thursday hit $24,748.43, up 4.81% in 24-hour trading, according to Coinbase. Thursday’s rise is a continuation of the rally of the first cryptocurrency with its price rising by 7.69% in just one week. Bitcoin currently has a market cap of $470.5 billion and has a current circulating supply of 19,118,581 BTC coins.
Across the board, cryptocurrency prices are seeing a boost this week following a softer-than-expected inflation report, with Ethereum, Bitcoin’s biggest rival, leading the pack with an 18.63% increase in value over the past week. Currently, Ethereum’s price is trading at $1,910.655 per ETH.
Why Is Bitcoin Rising?
Bitcoin surged above $24,000 on Wednesday, hitting its highest level in more than a month. Over the past week, Bitcoin prices have continued to rise and grow in value from Friday’s low of $22,392 to Thursday’s high of $24,569. However, despite the rise in Bitcoin prices, it is still 64.02% below the all-time high of $68,789.63 in November 2021. In recent weeks, the cryptocurrency market has seen an upswing, possibly indicating an end to the infamous crypto winter.
This is a relief for many investors as June saw the price of Bitcoin fall by around 38%, which is one of the biggest single month drops in cryptocurrency history. The price of bitcoin has been stable over the past week, helping it recoup its losses this month.
One reason why the prices of Bitcoin and other cryptocurrencies are going up is that they are closely tracked with the stock market this year. For the past few weeks, markets have been mostly in a decline, but have rallied across the US, Europe and Asia recently, helping crypto to follow this trajectory.
Another factor that plays into the rise of the crypto market is the cooling of inflation, which has negatively affected both commodities and the stock market. Analysts attribute the drop in US inflation to the crypto market as well, sending Bitcoin back to the $24,000 threshold on news that the consumer price index (CPI) is holding steady. The consumer price index was unchanged in July on a seasonally adjusted basis after rising 1.3 percent in June, according to the US Bureau of Labor Statistics.
The U.S. consumer price index rose 8.5 percent year-on-year in July, a slower annual increase compared to June, when inflation eased amid lower gas prices. Expectations that inflation will begin to decline are helping to improve investor confidence.
What is also accelerating Bitcoin’s rise?
The crypto market also got a second chance thanks to the news that Coinbase is partnering with BlackRock, the world’s largest asset manager to offer crypto investment services for large institutional investors and wealthy private clients. Under the agreement, Coinbase Prime will offer crypto trading, custody, prime brokerage and reporting capabilities to Aladdin’s institutional customer base who are also customers of Coinbase. The agreement will allow Bitcoin to further benefit among other large investments, including pension funds, mutual funds, foundations and endowments.
Built primarily for institutions, Coinbase Prime integrates advanced agency trading, custody, prime funding, staking and staking infrastructure, data and reporting that support the entire transaction lifecycle. It also combines these capabilities with leading security, insurance and compliance practices to provide institutional customers of Coinbase with a full-service platform to access crypto markets at scale. Coinbase’s clients include hedge funds, asset allocators, financial institutions, corporate tax and other institutions.
“This connection with Aladdin will allow clients to manage their bitcoin exposures directly within their existing portfolio management and trading flows for a whole portfolio view of risk across asset classes,” said Joseph Chalom, Global Head of Strategic Ecosystem Partnerships at BlackRock.
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