Bitcoin is back above $20,000, days after breaking a two-month-long ranging-market spell and printing a string of green daily candles.
In the past 24 hours, the top cryptocurrency by market capitalization grew over 11%, tapping $21,000 in the wee hours of Jan 14 before recoiling to $20,817 at press time. In the past seven days, the asset’s price has surged by over 23%, with $76.61B added to its market cap.
BTCUSD Chart by TradingView
Ether (ETH) followed closely, adding over 9% in the past day to trade just over $1,536 at press time. Ether has been rallying on the back of the upcoming “Shanghai hard fork.” Apart from improving a range of functionalities on the Ethereum network, the upgrade, which is slated for March, is expected to help validators “unstake” and withdraw Ether which they had locked up in the beacon chain since 2020.
Other crypto’s also benefitted from the market-wide rally, with SOL, MATIC, DOGE, ADA, BNB and XRP adding roughly 71%, 21.92%, 18.58%, 20.76%, 13.36% and 13.46%. In the past 24 hours, the total value of liquidations reached $731.63 million, with 135,136 short positions being wiped out, according to data by Coinglass.
The current market rally comes on the back of improved economic indicators that have encouraged investors back into the market. CPI data released Thursday by the US Labor Department showed inflation cooled off slightly In December, once again re-igniting hopes of the Federal Reserve slowing the pace of interest rate hikes.
“Another month in which inflation falls, now lower than November 2021. Month-to-month even showing negative numbers. Fuel for a relief period of 2-4 months for the markets, but probably short-term correction soon for Bitcoin,” said Michaël van de Poppe, a seasoned analyst and CEO of Trading Platform Eightglobal.
The resurgence has also been a pointer that investors are moving past the FUD created by the collapse of Sam Bankman-Fried’s crypto empire and other bad actors.
“Bitcoin has now reclaimed $20,000 for the first time since before the FTX collapse. Symbolically shows that no one can stop this movement, not SBF or any other individual,” crypto analyst Will Clemente tweeted.
Fundamentally, this week’s supernova rally has been attributed to large crypto investors buying BTC as market sentiment turned positive for the top cryptocurrency, particularly in the US.
“Amongst many of the foreshadowing metrics for this 2023 breakout was the rapidly growing amount of addresses holding 100 to 1,000 $BTC. Price pumps generally occur marketwide when whales accumulate Bitcoin,” on-chain data vendor Santiment tweeted.
Earlier yesterday, Ki Young Ju, Co-founder & CEO of crypto analytics platform Cryptoquant, also wrote that an unknown entity bought $4B worth of BTC futures in market orders for three consecutive hours.