Tech

Bitcoin Breaks Above $30K for First Time Since June 2022

Published

2 years ago

April 11, 2023

Bitcoin (BTC) moved past the $30,000 level for the first time since June 10, 2022 as March’s banking turbulence faded further into the distance and investors grew more optimistic about U.S. central bank monetary policy..

The largest cryptocurrency by market capitalization was recently trading at $30,237, up 6.75% over the last 24 hours.

“It’s clear that the market is pricing a slowdown in growth, and in turn a loosening of monetary policy by the Federal Reserve over the course of 2023,” said Richard Mico, the U.S. CEO and chief legal officer of Banxa, a payment-and-compliance infrastructure provider for crypto. “For evidence of this, just look at the bond market.”

A check of the bond market shows the U.S. 2-Year Treasury note having fallen to below 4% from a peak above 5% in early March as traders rapidly reversed their expectations of future Fed rate hikes.

“There will likely still be a lot of liquidity injected into the market as a result,” added Mico. “Already, Bitcoin has been the best-performing asset of 2023, and it usually is the asset that responds most quickly and violently to these kinds of monetary shifts.”

Bitcoin last topped $30,000 on June 10, 2022 as it was on its way down to below $20,000, where it spent large parts of late that year and into the first weeks of 2023. It has been hovering around $28,000 for the past three weeks as wary investors gauged the impact of a near banking meltdown, continued inflationary pressures and other macroeconomic uncertainties. Bitcoin is up about 80% year-to-date after starting 2023 changing hands at about $16,600.

“Undeniably, Bitcoin is decoupling from traditional equities and demonstrating its increasing appeal as a safe haven for investors across retail and institutional spheres,” Bob Ras, co-founder of Sologenic, a blockchain-powered network for tokenizing securities, said in a note to CoinDesk. “While the 2020-2021 period was perceived as Bitcoin’s breakthrough moment, the present time truly marks its ascendance onto the global stage as a formidable asset.”

The crypto surged in January amid signs that inflation was waning, stalled in February but then regained momentum in late March following the failure of Silicon Valley and Signature banks as some investors questioned the stability of the current monetary system and regained their appetite for assets that hold their value. Gold has also recently spiked, topping $2,000 for the first time since 2020.

Mico noted that there is certainly a narrative shift happening because of this banking crisis that is feeding into Bitcoin’s momentum. Increasingly, “BTC is also being seen as a reliable store of value that lacks the issues that come with storing your money by way of a third-party intermediary, or a bank,” he added. “BTC is now properly starting to be perceived as a risk-off asset.”

“De-dollarization is also increasingly becoming part of the narrative, which is further accelerating BTC adoption,” Mico concluded. “With BTC, in short, you are your own bank. It’s difficult to make predictions given the volatility of late, but I wouldn’t be surprised if this momentum regarding BTC continues.”