Bitcoin leads crypto market rally, climbing to a five-month high following the big bank’s hug

Top line

Within a few hours on Wednesday, Bitcoin prices rose to their highest level in months, leading to weeks of moderate price gains amid a flurry of positive developments for the recently troubled market, with the US Bank and Bank of America among the youngest established financial institutions Space.

The US bank says customers are “getting very serious” with cryptocurrencies, while Bank of America says: … [+] they are “too big to ignore”.

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Important facts

Bitcoin’s price rose 10% to more than $ 55,000 at 12:30 p.m. EDT on Wednesday, hitting its highest level in nearly five months, and helping its market cap eclipse $ 1 trillion for the first time since May according to the crypto data website CoinGecko.

Although it’s still about 15% below an all-time high in April, the world’s largest cryptocurrency far outperformed market gains on Wednesday, with Ether, Cardanos Ada and Binance Coin rising about 6%, 2% and 1% in the past 24 Hours or

In a statement on Wednesday, Freddie Evans, a sales trader at digital asset broker GlobalBlock, attributed some of the price momentum to the U.S. bank, the country’s fifth-largest bank by assets, and announced that it would launch a Bitcoin custody on Tuesday. Service launched to help Investment Managers store private keys for Bitcoin, Bitcoin Cash and Litecoin.

In an interview with CNBC, Gunjan Kedia, vice chairman of asset management for the bank said that clients are “taking the potential of cryptocurrency as a diversified asset class very seriously,” and also doubled expectations for growing institutional adoption, adding, “I don’t think so that there is a single asset manager who doesn’t even think about it. “

Meanwhile, Matt Senter, the chief technology officer of the bitcoin shopping app Lolli, said in an email that current economic conditions – characterized by rising interest rates and global market uncertainties – are also fueling the rise of bitcoin and adding the cryptocurrency (commonly referred to as Protection against inflation) has become “increasingly resistant to turbulence in the traditional markets”.

Senter pointed out that Bitcoin’s outperformance among cryptocurrencies also follows growing threats to the regulation of other digital assets – particularly so-called stablecoins, the values ​​of which are tied to other assets, and tokens tied to the booming decentralized financial sector.

Key background

Bitcoin and the broader cryptocurrency market soared to meteoric highs during the pandemic amid inflation concerns and increasing institutional acceptance, but prices began to plummet in April when Tesla – one of Bitcoin’s largest corporate investors – announced that it was selling and selling a large chunk of its holdings wouldn’t buy anymore until bitcoin mining uses less energy. Markets have since struggled to recover as regulators tightened in China, partly due to similar environmental concerns. The combined market value of the world’s cryptocurrencies is around $ 2.4 trillion on Wednesday, still about 10% below its high of $ 2.6 trillion on May 12.

tangent

Bank of America also fueled optimism on Monday, calling the emerging market “too big to ignore” in a message to customers. While admitting that Bitcoin’s volatility is still high, analysts said the cryptocurrency is showing signs of maturation that should allow it to become more common in investment portfolios. “Current bitcoin price momentum appears to be driven by mainstream owners and increased institutional interest, which could accelerate as regulatory rules become clearer and investor protection implemented,” the team said.

further reading

As Bitcoin tops $ 55,000, CME futures data gets even more bullish (Forbes)

Crypto markets destroy a value of 150 billion US dollars within hours of China’s latest “Bitcoin ban” – what’s next? (Forbes)

Crypto Flash Crash wipes out a $ 400 billion market value on Bitcoin Day as El Salvador’s president “buys the dip” (Forbes)

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