Bitcoin price has smashed through the $85,000 barrier, reaching a new all-time high. The surge marks a 25% increase in just one week. It also comes amidst a backdrop of underperforming tech stocks and a slump in gold prices, suggesting a potential shift in investor sentiment towards cryptocurrencies.
The recent rally aligns with the Federal Reserve’s monetary policy adjustments, which have seen interest rates lowered by 25 basis points in November, following a 50 bps cut in September.
These lower interest rates potentially free up capital for investment, often benefiting risk assets like Bitcoin. Adding to the bullish sentiment is the outcome of the recent U.S. presidential election, which has further fueled market optimism.
“This week, we expect the volatility of BTC and ETH to continue to increase, with potential upward breakthroughs followed by rapid corrections. The predicted range for BTC this week is between $76,000 and $85,000,” says Ryan Lee, chief analyst at Bitget Research.
Lee also believes Bitcoin price could reach $100,000 before the year’s end.
Tech and Gold Lose Their Shine as Bitcoin Price Soars
While Bitcoin continues its record-breaking run, traditional tech stocks are experiencing a downturn.
Apple, NVIDIA, Amazon, Microsoft, and Meta are all down today, while Google shows only a slight increase. Even Tesla, which holds 9,720 BTC, has only seen a 9.6% rise.
Gold, a traditional safe-haven asset, is down almost 3%. This stark contrast paints a picture of investors rotating out of traditional investments and into the crypto market.
Adding to this narrative, the iShares Bitcoin Trust ETF (IBIT) witnessed a massive $1 billion in volume within the first 35 minutes of post-election trading, according to Bloomberg analyst Eric Balchunas. This indicates a strong institutional appetite for Bitcoin.
Crypto Market Surges, But Volatility Remains High
The broader crypto market is also experiencing a significant upswing. Almost all major cryptocurrencies have seen substantial gains over the last week. While Ethereum price has increased by over 34% in 7 days, other assets like Dogecoin (DOGE), Cardano (ADA), and Solana have all climbed by 103%, 83%, and 36% respectively.
However, the market remains volatile. Over the past 24 hours, liquidations across the crypto market have topped $685 million.
While this is a classic sign of a short squeeze, many long positions have also been wiped out. This may suggest that traders are being caught out on both sides of the market.
Despite the volatility, Bitcoin’s momentum continues to build. Analysts point to a confluence of factors, including increased institutional adoption, favorable monetary policy, and growing mainstream acceptance, as driving this latest surge.
With Bitcoin’s price showing little sign of slowing down, the question now becomes: how high can it go?
