References to cryptocurrencies at holiday parties have probably ignited talk of crisis, fraud, and the end of an era. But as everyone returns to work, the largest digital currency, Bitcoin, continues his nine-day rally.
Bitcoin rose a whopping 4.5% on Thursday, trading around $18,356. This is his highest since early November, when the first signs of trouble on the FTX exchange kicked off a story of bankruptcy and criminal charges that devastated the crypto industry. According to Bloomberg data, cryptocurrency is on its longest winning streak since his July 2020 heyday.
Other coins also rose, with Ether at one point rising more than 5.6% above $1,400. But rather than anticipating a sudden resurgence of cryptocurrency enthusiasts, Wall Street believes it is profiting as a result of a shift in investor sentiment that has lifted technology stocks and other risky holdings. increase.
“Bitcoin appears to be on the rise in sympathy with equities and risk assets,” said Jake Gordon of Bespoke Investment Group. It’s out of the range, and a break below the December high would be a good test for the next few days.”
Bitcoin spent most of the last year trading alongside stocks, especially those of tech companies. They all took a hit when the Federal Reserve launched a campaign to raise interest rates and cut liquidity to stem the fastest inflation in decades.
This correlation died when FTX crashed and cryptocurrencies plummeted, but it’s back again in the New Year. The S&P 500 is up more than 3% in 2023, while his tech-heavy Nasdaq 100 is up about 4%.
“The market has tended to be risk-on so far this year, which has helped cryptocurrencies,” said Chris Gaffney, president of global markets at TIAA Bank. , added that it may be wading through the wreckage of cryptocurrencies following months of sales.