Why do world’s largest crypto assets continue climbing?

The recent banking crisis has helped Bitcoin rise in 2023, and some other cryptocurrencies are following suit: At the same moment that Bitcoin has surpassed $30,000, ether has surpassed $2,000 for the first time since May 2022. Bitcoin was earlier on Thursday at $30,533, up 1.5% from where it was a day earlier. At $2,003, ether was up 4.1%. At the time of writing, the price of one bitcoin is $30,331.

For the first time since June 10, 2022, Bitcoin has reached the extremely important level of $30,000. BTC has increased by around 80% this year and will perform remarkably through 2023. However, what caused Bitcoin to reach the $30,000 mark and how should this rise be approached have piqued investors’ interest globally. Here’s a closer look at what caused Bitcoin’s quick climb and if its rally will last. This week, Bitcoin increased by approximately 9% and reached a ten-month high. Bitcoin was trading at roughly $28,000 levels last week, and when it broke over this barrier on April 7, 2023, it immediately began to rise. On April 23, 2023, it reached $30,000 levels.

Bitcoin, which was hovering around $20,000, started showing upside movement, once the news of the fallout of technology-focused Silicon Valley Bank in the U.S broke out. Since then, Bitcoin has witnessed a sharp rebound in its prices and climbed nearly 80% up this year.

Around $1.24 trillion worth of cryptocurrencies are currently trading on the market, up nearly 4.49% in the previous day. If the upward price movement persists, analysts now think that $35,000 will be the next important level for BTC to cross.

The US Fed is expected to likely stop its tough approach to limit inflation by hiking interest rates one more time, according to cryptocurrency analysts, which is fueling the rise in BTC. The Fed is anticipated to moderate its aggressive approach on policy rates given that the U.S. banks are exhibiting advanced credit risks as a result of ongoing rate hikes and recession fears that are enveloping the U.S. economy.

As a knock-on effect, the recent financial crisis in the United States has revealed vulnerabilities in the banking system and increased demand for cryptocurrencies, which are frequently seen as safer alternatives to the traditional banking system in an unstable global environment.

The following are some of the main causes behind Bitcoin’s rise to its greatest level since June 2022:

Investors’ hope that the Federal Reserve will stop raising interest rates in the United States in light of the banking crisis.
According to March’s U.S. nonfarm payroll figures, hiring has slowed down. March saw a 236,000 increase in total nonfarm payroll employment compared to a 334,000 average monthly growth over the previous six months. It has been considered as a favourable indicator for the Fed to maintain its hawkish stance because its measures to slow down the demand for labour have been in line with forecasts.

crypto currency proponents have reiterated the significance of de-centralized finance and the need to have complete control over one’s own money without the regulation of banks, which themselves find it difficult to survive in a challenging global economic environment. This is because of the instability of the banking sector in the United States.

Less than a year will pass before the May 2024 Bitcoin halving event. As 2024 draws closer, this lead-up to the event is anticipated to drive BTC prices further higher.

What could the future carry for Bitcoin?
Retail investors might benefit from this current circumstance by diversifying their portfolio and using the systematic investment planning (SIP) strategy in BTC while the future of Bitcoin is still uncertain. They must keep a close eye on things because forthcoming economic developments could cause price volatility for bitcoin, which could go either way.

When deciding whether or not to invest your hard-earned money in Bitcoin, it’s important to keep in mind that, despite BTC’s rising value, the coin is still trading at a price that is approximately 50% below its all-time high of $68,990 in November 2021. A factor that is difficult to overlook while investing in Bitcoin is the extreme volatility caused by the use of cryptocurrencies, changing macroeconomic conditions around the world, and increased scrutiny of different crypto exchanges.