Bitcoin (BTC) has crossed the $30,000 threshold for the first time since June 10, 2022, as investors become more optimistic about U.S. central bank monetary policy and the turbulence in March's banking sector fades. The largest cryptocurrency by market capitalization recently traded at $30,237, marking a 6.75% increase over the last 24 hours.
Market Anticipates Slower Growth and Looser Monetary Policy in 2023
Richard Mico, the U.S. CEO and chief legal officer of Banxa, explain that the market is pricing a slowdown in growth and anticipating a loosening of monetary policy by the Federal Reserve for 2023. The bond market, with the U.S. 2-Year Treasury note falling below 4%, also supports this notion.
Bitcoin Benefits from Monetary Shifts and Liquidity Injections
Mico highlights that Bitcoin, as the best-performing asset of 2023, tends to respond quickly and dramatically to economic shifts. Bitcoin's growth could continue with an expected increase in liquidity injections into the market.
Bitcoin's 80% Year-to-Date Growth Amid Banking and Inflation Concerns
Bitcoin started 2023 at around $16,600 and has grown by approximately 80% year-to-date. Factors such as a near banking meltdown, ongoing inflationary pressures, and macroeconomic uncertainties have influenced wary investors.
Crypto Surge Tied to Inflation and Banking Crisis Narrative Shift
The recent surge in Bitcoin and gold prices can be attributed to signs of waning inflation and the failure of Silicon Valley and Signature banks. Mico notes that the banking crisis has contributed to a narrative shift. Bitcoin is increasingly perceived as a reliable store of value without the issues associated with third-party intermediaries like banks.
De-Dollarization and Accelerated Bitcoin Adoption
Mico also highlights the increasing prominence of de-dollarization in the narrative, further accelerating BTC adoption. Bitcoin's role as a self-managed bank alternative is becoming more appealing to investors.
Bitcoin's Safe Haven Appeal Amid Geopolitical Instability
Bob Ras, the co-founder of Sologenic, states that Bitcoin has decoupled from stocks and showcases its increasing appeal as a haven for investors. He emphasizes that Bitcoin's ascendance onto the global stage as a formidable asset has been marked by heightened geopolitical instability, faltering banking systems, and concerns surrounding reserve currencies.