This week, Bitcoin (BTC-USD) has surged by nearly 11.5% to $43,900. While global equity markets see-saw amid economic and geopolitical tensions, the largest cryptocurrency in the world has had a dream run this year with a gain of 155%.
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In comparison, Ethereum’s (ETH-USD) 84% surge during this period almost feels unimpressive. What’s important is the rally is broad-based across the crypto-verse. Solana (SOL-USD) and Ripple (XRP-USD) have surged by nearly 430% and 66%, respectively, over the past year.
While some are already seeing a bull trap in crypto prices, BTC has generally done well in the run-up to its halving. Potentially, shorts could be in for a surprise heading into 2024. Further, rising institutional interest in cryptos almost makes one wonder if the crypto winter ever happened. The ProShares Bitcoin Strategy ETF (BITO) now boasts over $1.6 billion in AUM. According to CoinShares, funds focused on digital assets have seen inflows of over $1.75 billion in the past 10 weeks.
This year, Bitcoin has once again cemented its role as a safe haven during times of stress. Furthermore, optimism about the Fed going for rate cuts next year is keeping investor sentiment buoyant.
Still, any surprise from the Fed or significant challenges at major firms in the crypto space could put a dent in the rally. The continued troubles at Binance (BNB-USD) are a case in point. If this year’s rally in Bitcoin resumes after a breather, we could witness a major bout of profit-taking at the $49,000 to $49,500 levels.
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