25 February, 2024

Major Events Impact on Crypto Prices: Bitcoin Hits 2023’s ATH

8 months ago

16 Dec, 2023

Over the past week, Bitcoin’s price achieved this year’s all-time high (ATH) of $31,400, while other cryptocurrencies also experienced a much-needed price surge. The upward momentum in the price chart was driven by significant events that occurred in recent days.

Investors have been capitalizing on major institutions filing for Bitcoin ETFs and other related offerings. Notably, market sentiment remained high throughout the week as BlackRock, one of the largest asset management firms, filed for a spot Bitcoin exchange-traded fund (ETF).

The SEC has approved the first leveraged Bitcoin futures ETF in the US, bringing spot Bitcoin ETF approval one step closer. If the new ETF receives regulatory approval, it could attract institutional investors and contribute to rising crypto prices.

Investors are also closely watching economic data from the United States, the world’s largest economy. Key data points such as GDP, inflation rates, and monthly expiry could influence crypto prices.

US Federal Reserve Chair Jerome Powell, during a hearing on monetary policy, affirmed that crypto has staying power as an asset class. Powell also acknowledged that the Fed views payment stablecoins as a form of money. He mentioned that inflation still has a long way to go before reaching the Fed’s target of 2 percent. 

In its battle against persistent inflation, the Fed increased interest rates by 25 basis points for the tenth consecutive time last month, targeting a range of 5% to 5.25%. However, on Wednesday, the Federal Reserve kept interest rates unchanged to assess the impact of higher borrowing rates on the economy.

It is predicted that the series of interest rate hikes would resume in July. In such a scenario, investors are turning to crypto as a hedge against inflation, while traders are anticipating the release of the US Q1 GDP on June 29 to inform their investment strategies. The UK GDP would also shape investors’ outlook, as the Bank of England has raised rates by 50 basis points to 5%.

Another significant event this week would be the expiration of over 145,000 BTC options, with a notional value of $4.5 billion, on Friday (June 30). The Put/Call Ratio currently stands at 0.52, with call open interest at 95,000 and put open interest at 49,000. The max pain point is at $25,000. The max pain point is the price at which the majority of options holders suffer loss. At the time of writing, BTC is trading near $30,226.

On June 19, the overall crypto market cap was $1.07 trillion, which increased to $1.18 trillion a week later. During the past week, the price of Bitcoin rose from $26,000 to its all-time high of $31,000 in 2023. The upcoming major events have yet to unfold, determining the impact on crypto prices.