Bitcoin is set for its best January since 2013 on bets that monetary tightening and the crypto-sector crisis are both ebbing.
The largest token is up 39% since the turn of the year, a first-month gain bettered only twice before when crypto was in its infancy. Smaller coins like Solana, Axie Infinity and Decentraland have doubled in value, part of a $280 billion January climb in digital assets overall, CoinGecko figures show. Bitcoin retreated 2.9% to $23,111 as of 10:44 a.m. in New York on Monday amid broad declines in risk assets.
The rebound from last yearās deep rout is part of a wider revival in risk appetite on expectations that central banks will slow interest-rate hikes and perhaps even cut borrowing costs later this year as high inflation moderates.
The rally in virtual coins has weathered ongoing fallout from the collapse of Sam Bankman-Friedās FTX exchange ā such as the bankruptcy of crypto lender Genesis Global Holdco LLC and a spate of layoffs across the industry.
January āfeels like a month of new beginnings, with emerging clarity as to bankruptcy proceedings, corporate restructurings and market fundamentals pointing to the bottom being behind us,ā wrote Noelle Acheson, author of the āCrypto Is Macro Nowā newsletter.
Still, there are plenty of skeptics who doubt if the rebound in the likes of crypto and tech stocks will last. One risk is that the soft economic landing markets are hoping for is fanciful because rates must stay higher for longer.
The comeback of speculative assets like Bitcoin and the Ark Innovation ETF āwill likely reverseā if oil, wages and consumer-price increases shift the āsoft landingā narrative temporarily in coming weeks into a āno landingā view, Bank of America Corp. strategists led by Michael Hartnett said last week.
Federal Reserve Chair Jerome Powell may also remind investors that officials plan to keep rates elevated for some time. Heās due to speak after an expected downshift by the Fed to a quarter-percentage-point hike this week.
Some corners of global markets are also flashing warnings. For instance, hedge funds have built up the biggest bearish bet on bond futures on record, clashing with the narrative that a peak in rate hikes is near.
For now, momentum is king. Rick Bensignor of Bensignor Investment Strategies targeted $25,000 for Bitcoin in a note Monday, a level it last hit in August.
The largest token is up 39% since the turn of the year, a first-month gain bettered only twice before when crypto was in its infancy. Smaller coins like Solana, Axie Infinity and Decentraland have doubled in value, part of a $280 billion January climb in digital assets overall, CoinGecko figures show. Bitcoin retreated 2.9% to $23,111 as of 10:44 a.m. in New York on Monday amid broad declines in risk assets.
The rebound from last yearās deep rout is part of a wider revival in risk appetite on expectations that central banks will slow interest-rate hikes and perhaps even cut borrowing costs later this year as high inflation moderates.
The rally in virtual coins has weathered ongoing fallout from the collapse of Sam Bankman-Friedās FTX exchange ā such as the bankruptcy of crypto lender Genesis Global Holdco LLC and a spate of layoffs across the industry.
January āfeels like a month of new beginnings, with emerging clarity as to bankruptcy proceedings, corporate restructurings and market fundamentals pointing to the bottom being behind us,ā wrote Noelle Acheson, author of the āCrypto Is Macro Nowā newsletter.
Still, there are plenty of skeptics who doubt if the rebound in the likes of crypto and tech stocks will last. One risk is that the soft economic landing markets are hoping for is fanciful because rates must stay higher for longer.
The comeback of speculative assets like Bitcoin and the Ark Innovation ETF āwill likely reverseā if oil, wages and consumer-price increases shift the āsoft landingā narrative temporarily in coming weeks into a āno landingā view, Bank of America Corp. strategists led by Michael Hartnett said last week.
Federal Reserve Chair Jerome Powell may also remind investors that officials plan to keep rates elevated for some time. Heās due to speak after an expected downshift by the Fed to a quarter-percentage-point hike this week.
Some corners of global markets are also flashing warnings. For instance, hedge funds have built up the biggest bearish bet on bond futures on record, clashing with the narrative that a peak in rate hikes is near.
For now, momentum is king. Rick Bensignor of Bensignor Investment Strategies targeted $25,000 for Bitcoin in a note Monday, a level it last hit in August.
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