Bitcoin (BTC), the largest cryptocurrency in the world, surged by almost 7% in the last 24 hours and surpassed $30,000 the highest price reached by Bitcoin in almost a year. According to CoinGecko, the last time that Bitcoin was traded at or above $30,000 was in June 2022 when BTC was moving lower after the bull market experienced in 2021. Other virtual currencies experienced gains as well.
Bitcoin Surpasses $30K For the First Time since June 2022
Bitcoin has once again surpassed the $30k barrier as the whole crypto market moves higher. According to data shared by CoinGecko, Bitcoin is leading with a 6.1% growth in the last 24 hours, followed by Binance Coin (BNB) and Cardano (ADA) in the top 10 with gains of 5.3% and 4%, respectively.
Solana (SOL), the 11th largest crypto in the market, surged by 16.2% during the same period of time, registering one of the largest gains among the top 100. This shows that some altcoins are also registering strong gains as BTC breaks a very important psychological level.
The last time that Bitcoin was traded for $30,000 was in June 2022. At that time, there was a bear market ongoing that pushed the price of Bitcoin from $69,000 at the end of 2021, to below $16,000 at the end of 2022. Now, it seems that Bitcoin is entering a new bull market that is pushing not only BTC but also other digital currencies higher.
Bitcoin has also been increasing its dominance in the market in recent weeks. Indeed, in 2023, Bitcoin’s dominance went from 38% to 45%. This shows that there is a clear interest in Bitcoin rather than in other virtual currencies. Let’s not forget that Bitcoin has many times been the leader in terms of market growth and expansion.
When Bitcoin moved higher, usually altcoins followed. The question is now related to how fast other digital currencies can grow when Bitcoin trends higher. Another thing to take into consideration is related to the fact that Bitcoin seems to be gathering attention from the media as a good hedge against inflation.
Growing Interest Rates and Bitcoin’s Price
There is one thing that has surprised many Bitcoin investors in recent months. Usually, it was supposed that Bitcoin should move higher and start its bull runs when interest rates moved lower. Now, we are in an environment in which interest rates are moving higher as central banks have to fight growing inflation.
After the COVID-19 crisis, central banks all over the world started printing money. This was in order to avoid the economy to stop due to lockdowns. However, production fell, and prices started to move higher to reach new highs in many countries. In the United States, for example, inflation reached close to 10% at its peak (y/y). In other countries such as Estonia, inflation rates surged above 20%. This shows that even in countries with reputable currencies there has been a strong impact from inflation that affected purchasing power.
With these high inflation rates, central banks, including the U.S. Federal Reserve (FED) or the European Central Bank (ECB), started to increase interest rates. Nowadays, inflation is coming down in some countries, but it remains extremely high if we compare it with what happened in the last decade. Therefore, it will be important to see which are going to be the measures implemented by central banks in order to reduce the impact of inflationary policies.
Bitcoin is certainly going to play a key role in the future. Even in an environment that might not be ideal for Bitcoin (interest rates moving higher), there have been other factors that could have pushed investors towards the largest cryptocurrency in the world. Some of these things could be related to a banking crisis that could come in the coming months, or higher inflation rates despite the hikes in interest rates.
At the time of writing this article, CoinGecko reports a Bitcoin price of over $30,150 and a market capitalization for the largest digital currency of over $580 billion. It will be very interesting to see how this will evolve and whether Bitcoin will continue with this bull run.