BTC approaches $30,000, hit highest price since June
For a while on Monday, even though much of the world was off to celebrate Easter Sunday, bitcoin (BTC) appeared headed for a promised land above $30,000.
The biggest cryptocurrency by market capitalization, which just three weeks ago had teased a run towards that threshold, topped $29,300, its highest level since early June, amid a surge in investor optimism. But the reason for the move was difficult to determine.
From approx. 10:00 to 11:00 ET (14:00-15:00 UTC), bitcoin rose nearly 4%. It had lingered near $28,000 since mid-March, when fears about the conventional banking system began to subside.
“There is not a clear catalyst for this peak,” Edward Moya, senior market analyst for forex market maker Oanda, wrote in an email to CoinDesk, though he said the increase may stem in part from “buying by crypto traders expressing frustration at social media over a one-page New York Times article that took over [bitcoin’s] energy consumption.”
Moya also noted that the move higher “occurred around the release of news that Federal Home Loan Bank debt issuance had tapered off, signaling that the ‘banking crisis was easing.’
Ether (ETH) also bounced, crossing the $1,900 level before retreating. It was recently up about 1.7% versus 24 hours earlier. Other major cryptos were mostly in green, albeit light shades. ARB, the symbol of the layer 2 blockchain Arbitrum, recently increased by more than 2.8%, while XRP rose by around 1%. The CoinDesk Market Index, a measure of the crypto market’s overall performance, recently rose 2.3%.
Stock indexes closed roughly flat with the S&P 500 and Dow Jones Industrial Average rising a few ticks of a percentage point, and the tech-heavy Nasdaq Composite losing 0.03%. Crypto-related stocks had a memorable day with crypto exchange Coinbase (COIN) and corporate bitcoin vault MicroStrategy (MSTR) both rising more than 7.5%.
Markets will look to the March consumer price index (CPI) this week for signs that inflation is continuing its recent decline.
In February, inflation in the US eased to 0.4% from 0.5% a month earlier and 6% on an annual basis from 6.4% the previous month. Bitcoin jumped past $26,000 following this report, on March 14.
A continued slowdown could encourage central bankers to scale back their year-long regime of hard rate hikes, although the impact on bitcoin is uncertain. The crypto seemed to gain momentum following the recent US bank failures that caused concerns for the conventional financial system, as investors shifted towards assets that retain value through good times and bad.
Investors will also weigh the first wave of quarterly results with banking giants JPMorgan Chase, Wells Fargo and Citigroup due to report results. Analysts expect a largely depressed quarter, especially in the hard-hit financial sector.
“BTC is also seen as a trusted store of value that lacks the hassles of storing your money using a third-party intermediary, or a bank,” Richard Mico, US managing director and legal head of Banxa, a payment service provider and compliance infrastructure to the crypto industry, wrote in an email to CoinDesk. “This is further supported by the declining correlation with equity markets since 2021 – BTC is now beginning to be perceived as a risky asset.”
Joe DiPasquale, CEO of crypto fund manager BitBull Capital, was cautiously optimistic about the sustainability of bitcoin’s Monday rally.
“Bitcoin will likely find resistance at $30,000,” DiPasquale noted in an email to CoinDesk. From a technical-analysis perspective, the current move is “a retest of the high range established in March after the initial rise from below $20,000. If this test succeeds, the price will claim $30,000, while a failure here will see BTC drops to $25,000, followed by $23,000.”
But he added: “The current price is also testing the lows of July 2021, where the market bounced back to another big rally.”
