Tech
Bitcoin surpasses $70,000 and approaches an all-time high as tech stocks rise
Bitcoin recently broke the $70,000 leveljust $3,700 from its March 14 high of $73,700. Previously, the $70,000-71,000 range acted as resistance, with Bitcoin bounced below $70,000 three times.
We’re already a month and a half past the Bitcoin halving, and… the cryptocurrency market has consolidated By. Bitcoin breaking above $70,000 could mean the start of the bull season.
Technology stocks are also seeing healthy growth $ARM up 5.5% between May 31st and June 3rd e $MGNI up 8.4% during the same period.
Rumors of Fed rate cuts in September could have contributed to Bitcoin’s growth and the surge in tech stocks. Inflation in the United States, coupled with a weaker job market, appears to be pushing prices higher for the entire cryptocurrency sector.
Let’s discuss why this is happening and what it could mean for the broader economy.
Bitcoin’s longest daily run since March: a good sign
Bitcoin has registered its longest winning streak since March in the last few days, which means it happened consistent daily increases without strong subsequent declines.
Source: MoneyWeb
This has led to steady daily growth for several other cryptocurrencies, such as:
The total market capitalization of cryptocurrencies grew by 2.85% daily and 24-hour volume by 20.51%, with Bitcoin ETFs also seeing significant growth over the past 24 hours.
Also worth mentioning is Keith Gill’s return to X and the new surge in GME, which led to a meme coin frenzy.
Bitcoin surpassing $70,000 appears to be the conclusion of a series of events that have impacted both traditional and crypto finance.
The SEC sows confusion around Ethereum and the crypto space
The cryptocurrency industry is often influenced by political discussions and financial debates.
On April 26, Consensys, the company behind MetaMask and founded by one of the co-founders of Ethereum (Joe Lubin), sued the SEC.
The SEC does not have the authority, nor should it, to regulate global peer-to-peer computer networks. The SEC’s aggressive influence over commodities, software, and these new technology platforms is illegal.Consents
The SEC had informed Consensys that MetaMask had turned the company into an “unregistered securities broker-dealer.”
Furthermore, Joe Lubin stated that The SEC had sought to reclassify Ethereum as a security for a long time, suggesting deliberate abuse by the SEC.
At the same time, the approval of $ETH ETFs shows the SEC’s contradictory stance on Ethereum.
You could say this is an ad hoc approach to crypto assets creates significant FUD and volatility in the market.
Fed interest rate cuts and cryptocurrencies benefit inflation in the United States
The hearsay going around Interest rate cuts by the Fed (which could be false) is also a likely contributor to Bitcoin’s recent spike.
Lower interest rates push investors to seek riskier assets like cryptocurrencies to pursue higher ROI.
When interest rates fall, people can save more money and start investing in riskier opportunities like cryptocurrencies.
Here because Cryptocurrency markets are inversely related to interest rates. When interest rates rise, cryptocurrency prices tend to fall as there is less demand.
US inflation is currently at 3.36%, higher than the long-term average of 3.28%. Cryptocurrencies are traditionally used as a hedge against inflation.
High inflation tends to push investors towards cryptocurrencybe it Bitcoin or riskier investments like meme coins. Bitcoin is particularly attractive to some investors who prefer it to altcoins and meme coins.
The Verdict: Is Bitcoin Going Bullish?
Bitcoin’s run above $70,000 doesn’t look like a fluke; more like the result of multiple macroeconomic factors for example:
- $BTC ETF approved on January 10, 2024
- $ETH ETF approved on May 24, 2024
- High inflation in the United States
- Rumors of Fed rate cuts
- The halving of Bitcoin
It remains to be seen whether it will surpass its all-time high of $73,700 from March. But a bull run may be in storeconsidering all the underlying aspects discussed.
Cryptocurrencies are inherently volatile and risky, therefore we invite you to DYOR and invest responsibly.
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