With bitcoin now trading above $20,000 for the first time since the FTX meltdown in early November, Bitcoin's (BTC) 2023 climb is still going strong.
After circling about the mid-$16,000 range since mid-December, the largest cryptocurrency by market capitalization opened the week close to the $17,000 mark. With a current price of $20,250, bitcoin has increased by more than 20% so far this year. Even said, the cryptocurrency, which reached a high of $65,000 in November 2021, is still towards the bottom of a terrible bear market.
According to Craig Erlam, senior market analyst at foreign exchange market maker Oanda, $20,000 "once [was] deemed a disturbing low but now potentially represents a sign of a revival."
Ether (ETH), which has gained more than 20% year to date and is approaching $1,500 for the first time since early November, is also trending nicely higher.
For the week, the CoinDesk Market Index (CMI) increased by 14%.
Coinbase (COIN), a cryptocurrency exchange, increased by 39% this week, and Marathon Digital Holdings (MARA), a bitcoin miner, increased by 76%.
Traditional markets also saw gains for the week, with the S&P 500 rising more than 2% as Q4 earnings season got underway and U.S. inflation numbers—while still elevated—kept falling. "Optimism has been compounded by the first monthly inflation decline in two-and-a-half years and further sharp annual declines in both the headline and core readings," according to Erlam.
The co-founder of the market research company DataTrek Research, Nicholas Colas, stated in a note that although the US Federal Reserve's monetary policy is still important, "other issues like China’s reopening, the pace of US economic and corporate earnings growth, and positive real rates will jostle for investors’ attention."
"None of this guarantees that 2023 will be a good year for risk assets, but it does say it will look a lot more normal' than last year," according to Colas.
By fLEXI tEAM