The price of bitcoin reached over $40,000 for the first time in 2018, riding a wave of momentum carried by widespread optimism about interest rate cuts in the United States. Additionally, traders are anticipating the forthcoming approval of bitcoin funds that are traded on the stock market in the United States.
During Sunday trading, the world’s most valuable currency reached a high of $40,210, marking its highest level since April 2022. On Monday morning, in the early hours of Asia Day, it remained unchanged at $40,011 with minimal activity.
“We’ll see if it sticks throughout the day, but bitcoin loves a break at big psychological levels, so it excites the bit-bugs again and adds to this momentum,” according to Capital.com economist Kyle Rodda.
The price of bitcoin has more than quadrupled over the year, bouncing back from the gloom that characterized the so-called “crypto winter” that occurred in the wake of scandals such as the failure of the exchange FTX in the previous year.
Riskier investments and other interest-rate-sensitive assets, such as gold, have also rallied significantly over the past few weeks. This is because markets are betting that the Federal Reserve of the United States has completed its rate hikes and will begin reducing rates at the beginning of 2023.
In October, it was reported that the United States Securities and Exchange Commission would not appeal a court verdict that ruled the agency had been incorrect in denying an exchange-traded fund application from the cryptocurrency company Grayscale Investments. These reports have also fueled wagers that an eventual approval is close.
According to the reasoning, a spot bitcoin exchange-traded fund (ETF) would make it possible for investors who were previously apprehensive to gain access to cryptocurrency through the stock market, bringing a fresh influx of cash into the industry.
Ether, the cryptocurrency connected to the Ethereum blockchain network, also reached a new all-time high on Sunday, attaining a value of $2,218. On Monday, the price of Ether Ethernet was stable at $2,197 in Asia.
The value of bitcoin and ether remained much lower than their record highs from 2021, respectively greater than $60,000 and $4,000.