Bitcoin and other cryptocurrencies continued their upward trajectory on Wednesday, reaching fresh 20-month highs. Over the past seven weeks, digital assets have benefited from a perfect storm of factors that have propelled prices to new heights.
In the past 24 hours alone, the price of Bitcoin surged by 6% to nearly $43,800, briefly surpassing $44,000. This marks the highest point since early April 2022, before cryptocurrencies plummeted into a bear market. Since mid-October, Bitcoin has been on an unstoppable streak, driven by multiple catalysts, including optimism surrounding the potential approval of the first spot Bitcoin exchange-traded fund (ETF) by U.S. regulators.
Zach Pandl, Managing Director of Research at digital asset manager Grayscale, explains, “Both micro and macro factors are currently aligning for Bitcoin. The dovish stance of the Fed, tightening supply due to the upcoming halving, and anticipation of a spot Bitcoin ETF approval and a contentious presidential election in the United States are all contributing to the current rally.”
These factors have resulted in Bitcoin outperforming the stock market in recent weeks, surpassing the Dow Jones Industrial Average and S&P 500. This is noteworthy, given that equities have also experienced gains due to a favorable macro environment.
In addition to Bitcoin’s surge, Ether—the second-largest cryptocurrency—increased by 4% to reach $2,275. Smaller tokens or altcoins also experienced substantial growth, with Cardano climbing 8% and Polygon popping 5%. The meme coins were particularly impressive, with Dogecoin soaring by 17% and Shiba Inu jumping by 13%.
Bitcoin’s remarkable ascent seems to be driven by a confluence of factors that have set the stage for its continued success. With positive developments on the horizon and bullish market sentiment, cryptocurrencies are asserting their dominance in the financial landscape.