Bitcoin Price Surges to One-Month Highs
Bitcoin’s Rise
Bitcoin experienced a 5% surge on Friday, reaching one-month highs, driven by a surge in buying activity ahead of April’s halving event and a slowdown in outflows from exchange-traded funds.
Market Performance
The cryptocurrency hit a session peak of $47,705, the highest since January, following the approval of the first U.S. listed spot bitcoin exchange-traded products. At present, Bitcoin is up 3.5% at $46,946, with Ether also rising 2.5% to $2,486.
Market Trends
In January, Bitcoin hit a two-year high just above $49,000 but subsequently trended lower due to profit-taking after the Securities and Exchange Commission approved the ETFs. However, despite this, Bitcoin has resumed its upward trajectory, contrary to other financial markets.
Factors Influencing Bitcoin Prices
The recent jump in price is attributed to a slowdown in ETF outflows and increased buying activity in anticipation of April’s halving event, a process designed to slow the release of bitcoin. Historical trends suggest that post-halving, Bitcoin prices tend to experience significant growth.
Bitcoin’s Historical Performance
Bitcoin prices have typically rallied following halvings, with significant price jumps occurring within months of the event. Additionally, Bitcoin has historically performed well during U.S. election years, coinciding with halving cycles.
ETF Outflows and Dollar’s Influence
Recent data indicates that ETF outflows have eased, particularly from the Grayscale Bitcoin ETF, the largest by assets, which has supported spot crypto prices. Furthermore, the recent rise in the dollar has impacted cryptocurrency; however, this effect is expected to diminish over time.
Source: Adapted from Reuters
