Bitcoin lifts crypto sentiment by returning to a 17-month peak.

Nov 2
Predictions that a new source of demand is developing for exchange-traded funds (ETFs) and hopes that the Federal Reserve would halt interest rate hikes drove Bitcoin back to a peak that was more than 17 months ago.

As of 10:53 a.m. Singapore time on Thursday, the largest digital token was trading for $35,840, having risen 4% in the previous 24 hours. The price of certain lesser coins has increased. For example, the SOL token of the Solana network has increased by 142% to $42 since mid-September.

Due in part to wagers that the Securities and Exchange Commission may accept applications from businesses like BlackRock Inc. to introduce the first U.S. ETFs that invest directly in the token, Bitcoin has more than doubled in value this year.

"The ETF news has created enough sustained momentum to make some breakouts toward $37,000, but resistance has firmed up at $35,000," Michael Safai, a partner at Dexterity Capital LLC, a proprietary trading firm, stated.

Jerome Powell, the chairman of the Federal Reserve, suggested that the US central bank might have finished its most aggressive cycle of rate hikes in forty years. This resulted in substantial gains for equities, bonds, and commodities on Thursday in international markets.

Bitcoin's major use case is as a non-sovereign monetary system and a digital substitute for actual gold, according to the research team of cryptocurrency fund manager Grayscale Investments LLC. They also noted that Bitcoin is receiving a boost from some individuals viewing it as "digital gold" in a note.

SOL has increased as the Solana project attempts to move past its association with discredited former cryptocurrency tycoon Sam Bankman-Fried. Ethereum, the main commercial driver of cryptocurrencies, and Solana are competing for a bigger piece of the digital asset market.

One factor supporting SOL might be Solana's excellent operational performance; according to Grayscale, there was just one network outage in 2023 as opposed to 14 the previous year.

According to CoinGecko, the entire market value of cryptocurrency tokens has increased to $1.36 trillion, which is still less than the $3 trillion peak in 2021.
Additionally, investor demand and liquidity are now lower than they were during the period when ultra-low borrowing costs and stimulus injections drove a bubble in the price of digital assets.

Noel Acheson stated in the Crypto is Macro Now newsletter that "the main impediment to strong inflows at the moment is the relative lack of liquidity, as it increases the risk of slippage and the ability to exit if necessary."

According to him, there are early indications of growing institutional investor interest in contributing to the solution of the liquidity issue.

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