5 min readBitcoin has broken out of its near-term range, blasting above the psychological 100K level to a new multi-month high of 102.5 K. Altcoins have followed suit, with significant price gains in Pepe, Sui and Fartcoin. Even Ethereum has risen by double digits, breaking above 2K for the first time in over a month.
Bitcoin has seen a phenomenal recovery from under 75K just one month ago, rising 30% to reach its highest level in eight weeks. BTC trades up 8% YTD but remains below its record high of 109.5 K, reached in early January.
Meanwhile, the cryptocurrency market capitalization rose to $3.16 trillion a 5.7% increase over the past day. This rise sparked a wave of liquidations. According to Coinglass data, the crypto market saw $577 million in liquidations, with $505 million in short liquidations and just $72 million in long liquidations.
US trade deal optimism lifts BTC
The move began on Wednesday after the US announced it would be holding trade talks with Chinese officials in Switzerland this weekend, signalling a possible de-escalation in a tariff standoff between the two world’s largest economies. Trade deal optimism continued on Thursday as Donald Trump announced a trade deal with the UK. These moves show that trade tensions are easing, and Trump is showing a willingness to negotiate, helping to improve risk sentiment across the board.
US equities were also trading higher, with the Nasdaq above 20,000, up 1.7% on the day. Meanwhile, safe-haven gold is falling 1.6% back to $3300. Up until last month, Bitcoin was largely correlated to US tech stocks. However, Bitcoin outperformed both US equities and Gold in April and is extending that position in May.
BTC ETF & corporate demand rise
In addition to the supportive macroeconomic narrative, Bitcoin is also being lifted by surging institutional demand. Bitcoin ETFs have risen over the past four weeks, seeing inflows of over $3.5 billion. Investors’ preference for BTC over gold came into focus after BlackRock’s Bitcoin ETF surpassed the most popular gold ETF in year-to-date flows.
Corporate demand adds to the bullish picture as Strategy (formerly MicroStrategy) ramped up its buying plan. Strategy now holds 555,450 Bitcoin, which is 2.6% of all Bitcoins that will exist. Strategy plans to raise a further $84 billion to add another 840,000 Bitcoins. Strong corporate purchases are bullish for BTC.
Regulatory tailwinds grow
Regulatory newsflow remains upbeat. This week, the governors of two US states have signed bills making it legal for the states to establish strategic Bitcoin reserves. Earlier in the week, New Hampshire signed a bill, and today, the US state of Arizona approved a landmark crypto reserve law, becoming the second US state to do so. Texas may be next in line. Strong state demand could boost BTC price.
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