Bitcoin (BTC) tops $ 22,000, ethereum jumps while crypto market rally

Bitcoin jumped over $ 22,000 on Monday, reaching its highest level in more than a month as the cryptocurrency market held out hope that the contagion and shakeout in recent weeks is nearing an end.

The world’s largest cryptocurrency traded around $ 22,228.70 at 6:30 ET, according to CoinDesk data, up around 4%. Bitcoin traded as high as $ 22,493.61 in the last 24 hours, the highest since June 16.

Other cryptocurrencies also jumped with ether up by more than 10% compared to the price 24 hours ago and Polygon’s MATIC token up 21%.

The bullish sentiment was helped by a rally in the stock markets in Europe and Asia. US stock futures were also higher. Cryptocurrencies, especially bitcoin, have been closely correlated with stock market trading. An increase in shares will often also lift sentiment in the crypto market.

But investors are also looking at whether the carnage in recent weeks, which has seen bitcoin close to 70% of its all-time high hit in November and billions of dollars dried out of the market, may be over.

The price crash has led to the downfall of several high-profile companies in the area, especially the hedge fund Three Arrows Capital and cryptocurrency lender Celsius, both of which have filed for bankruptcy.

These collapses have caused contagion across the industry and put other affiliates under pressure.

Much of this has been caused by the enormous amounts of influence and loans that have taken place in this recent crypto cycle. For example, Three Arrows Capital took out loans it was unable to repay when the cryptocurrency collapsed. Celsius, which offered customers a return of over 18% for depositing digital coins, took on high-risk trading activities to earn interest in trying to give back to users.

Cryptocompanies have sold out what assets they have to try to meet their obligations, which has put pressure on the wider market.

Analysts say there are signs that this infection may be declining.

“The worst market infection has probably gone its way, with the majority of forced sales behind us,” wrote David Moreno, a research analyst at CryptoCompare, in a research note.

Despite the rally, the crypto market is still suffering. Both bitcoin and ether are down more than 50% this year. Bitcoin had its worst quarter in more than a decade in the second quarter.

Analysts are still not convinced of any significant upward growth in the short term.

“Given the severe negative performance in Q2, it is not surprising that a ‘relief’ has occurred. We believe the market will continue to be interval-bound in the coming months,” said Moreno.