Bitcoin recently surged above $42,000, having for several days. This market recovery is believed to be a result of different factors, including .
Macroeconomic Factors That Contributed To The Recent Bitcoin Surge
The personal income expenditures (PCE) price index, a , was released on January 26 and to have been lower than expectations. This suggests that inflation in the United States is cooling off, and experts predict that the Federal Reserve will likely reduce their aggressive monetary policies.
The Fed’s hawkish stance is known to have a and the broader crypto market. As such, this recent development is a positive one and is something that could have influenced investors to double down on their investments in the flagship cryptocurrency, thereby sparking a price surge.
Meanwhile, from the US Treasury recently showed that the country has hit an of $34,1 trillion. While this has raised concerns about the looming crash of the US dollar, it has also presented Bitcoin and other cryptocurrencies to hedge against the potential devaluation of the nation’s currency.
Interestingly, different financial analysts, including renowned economist Peter Schiff, have continued to predict the imminent crash of the US dollar. In light of this, has urged everyone to invest in Bitcoin to avoid becoming poorer due to the government’s actions.
Another factor believed to have contributed to Bitcoin’s recent surge is the expiration of monthly BTC options contracts on Deribit. The expiry outcome more than likely played a crucial role in Bitcoin’s rally, considering that CryptoQuant CEO Ki Young Ju the derivatives market as responsible for Bitcoin’s recent decline.
BTC price jumps after downtrend | Source:
GBTC’s Outflow Slows For The Fourth Consecutive Day
an outflow of just $255.1 million on January 26, continuing a recent trend of reduced outflows from the fund. NewsBTC reported how the Bitcoin ETF had seen outflows of $515 million, $429 million, and $394 million on January 23, 24, and 25, respectively.
As by , January 26 also happened to be the lowest outflow day for GBTC since converting to a . This development suggests that the fund’s investors may be cooling off on taking profits. It is also significant because has contributed to the selling pressure that has plagued Bitcoin of late.
At the time of writing, Bitcoin is trading at around $41,700, up over 4% in the last 24 hours according to data from CoinMarketCap.