Bitcoin surges to a 17-month high at $35,840 on hopes of no more Fed rate hikes and potential ETF demand. Solana’s SOL token also rises 142% to $42.
- Bitcoin surges to a 17-month high, reaching $35,840 in the past 24 hours.
- Hopes for no more interest-rate hikes from the Federal Reserve boost market sentiment.
- Solana’s SOL token also witnesses a significant 142% climb since mid-September.
- Bitcoin’s rise is partly attributed to anticipation of SEC approval for cryptocurrency ETFs.
Impressive Soar By Bitcoin
Bitcoin, the leading cryptocurrency, has once again reached a remarkable milestone, surging to a 17-month high. Over the past 24 hours, its price soared by 4%, bringing it to $35,840. This impressive rally can be attributed to several factors, including growing optimism that the Federal Reserve will refrain from implementing further interest-rate hikes. Additionally, the anticipation of fresh demand emerging from the exchange-traded fund (ETF) industry has contributed to Bitcoin’s resurgence.
Notably, smaller cryptocurrencies like Solana’s SOL token have also experienced substantial gains during this period, with SOL appreciating by an impressive 142% since mid-September.
— Pompcoin (@pompcoin) November 2, 2023
One significant driver of Bitcoin’s recent surge has been the expectation of Securities and Exchange Commission (SEC) approval for ETFs that directly invest in the cryptocurrency. Prominent financial institutions such as BlackRock Inc have applied for permission to launch the first US ETFs dedicated to Bitcoin, further fueling market enthusiasm.
Michael Safai, a partner at the proprietary trading firm Dexterity Capital LLC, commented on the current Bitcoin price movement, stating, “Resistance has solidified near $35,000, but there’s enough sustained momentum around the ETF news to make some runs toward $37,000.”
Bitcoin As Digital Alternative?
Meanwhile, Federal Reserve Chair Jerome Powell’s suggestion that the central bank may have concluded its most aggressive rate-hiking cycle in four decades has led to broad gains across global financial markets, including stocks, bonds, and commodities.
Furthermore, the research team at crypto fund manager Grayscale Investments LLC pointed out that Bitcoin’s status as “digital gold” has contributed to its recent success. They noted that “Bitcoin’s core use case is as a non-sovereign money system and digital alternative to physical gold.”
Solana’s impressive performance can be attributed to its efforts to distance itself from its association with the discredited former crypto mogul Sam Bankman-Fried. The Solana network is currently competing with Ethereum for a larger share of the digital-asset activity market. Grayscale highlighted Solana’s “robust operational performance,” with only one network outage in 2023 compared to 14 incidents the previous year.
Despite the market’s rally, the overall market value of cryptocurrency tokens remains at $1.36 trillion, still short of the $3 trillion peak observed in 2021, according to CoinGecko data. Investor demand and liquidity have also decreased compared to the previous peak, due to changes in stimulus injections and borrowing costs, which previously fueled a digital-asset price bubble.
Noelle Acheson, in her Crypto is Macro Now newsletter, pointed out that the relative lack of liquidity is currently the main barrier to significant inflows into the cryptocurrency market. However, there are emerging signs of increased interest from institutional investors, which could potentially address the liquidity challenge.
The cryptocurrency market’s resilience and Bitcoin’s continuous ascent reflect a growing confidence in the digital asset space, driven by both retail and institutional investors. The potential approval of Bitcoin ETFs by regulatory authorities presents a significant opportunity for broader market participation and investment, further solidifying Bitcoin’s role as a digital store of value. Solana’s impressive performance showcases the ongoing competition among blockchain networks for dominance, with its robust infrastructure and improved operational performance contributing to its success. While the crypto market has not yet reached its previous peak in terms of overall market value, it continues to evolve and adapt, attracting a diverse range of investors and stakeholders.