As actual winter sets in, “crypto winter” seems like it could be coming to an end.
What happened: A surge has put Bitcoin prices over $56,500, as of the end of the day on Monday. Prices for the cryptocurrency are now up 152% so far this year, returning to price levels seen just before rising inflation led to a sell-off and subsequent crash in April 2022.
- Other cryptocurrencies had a good day too, with Ether up 85.8% on the year. Stocks for crypto-related companies also got a boost, with Coinbase up 320% from January.
Why it matters: Crypto is becoming more attractive to traditional investors, not just typical enthusiasts, thanks to more stable ETF investment options and interest rate hikes fading into the rear-view.
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The SEC is expected to approve crypto ETFs from the likes of BlackRock within the next month, something that has been driving investor optimism since the fall.
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As inflation cools, central banks are also expected to begin reversing interest rate hikes, which historically creates gains for riskier investments, like crypto.
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Even bad headlines, like Binance’s Changpeng Zhao pleading guilty to charges, are being seen as weeding out the bad eggs and helping boost crypto’s perception
Yes, but: If any of the factors working in crypto’s favour right now go sideways, it will be another stumbling block in a two-year span that has been riddled with problems. —JK