Bitcoin has been on a tear, breaking through the crucial resistance level of $71,000 in recent times. The surge in Bitcoin’s price has also sparked a corresponding surge in altcoins.
Recently, Bitcoin (BTC) skyrocketed past $71,000, getting closer to its all-time high of $73,628. This rally comes ahead of the upcoming Federal Reserve meeting, where investors are anticipating potential rate cuts later in the year.
The possibility of lower interest rates has been fueled by recent economic data indicating a slowdown in inflation and a weakening job market in the US. These factors are likely to influence the Fed’s monetary policy decisions.
Lower interest rates tend to have a positive impact on speculative assets like Bitcoin. Tom Couture, a digital asset strategist at Fundstrat Global Advisors, noted in a recent investor note that “Crypto assets are responding positively to the decline in rates.”
Another factor contributing to the upward movement of Bitcoin is the significant inflows into spot Bitcoin Exchange-Traded Funds (ETFs). Blockchain researcher Collin Brown highlighted that spot Bitcoin ETFs received a massive inflow of $887 million on Monday, marking the second-highest single-day net inflow since the launch of Bitcoin ETFs.
The total net asset value of BTC spot ETFs now stands at $61.46 billion, with major players like Grayscale Investments, Fidelity Investments, and BlackRock all contributing to this surge in investment. Fidelity’s FBTC led the inflows with over $378.7 million, followed by BlackRock’s IBIT with $275 million, and Ark Invest’s ARKB with $138.7 million. Grayscale’s GBTC, which initially experienced large outflows, saw inflows of $28.2 million.
There are several indicators suggesting that Bitcoin may soon reach a new all-time high. The global demand for Bitcoin ETFs is rising, with countries like Australia and Thailand also offering these investment vehicles. Additionally, the correlation between Bitcoin and the Nasdaq 100 is at its highest point since early 2023, hinting that further gains in the Nasdaq 100 could lead to a rise in Bitcoin’s price.
The broader crypto market has also shown positive momentum, with BNB, the native token of Binance, surging over 10% in the last 24 hours to reclaim a market capitalization above $103 billion. Tocoin (TON) has entered the top ten largest cryptocurrencies after a 7% surge in 24 hours, while Shiba Inu (SHIB) in the memecoin ecosystem increased by nearly 8% to trade at $0.0000259, making it the 11th largest digital asset by market capitalization.