Bitcoin Breaks Above $70K and Nears ATH as Tech Stocks Are Soaring
Bitcoin recently broke the $70K level, only $3,700 away from its $73,700 ATH on March 14. Previously, the $70K-71K acted as resistance, with Bitcoin rebounding three times below $70K.
We're already one-and-a-half months into the Bitcoin halving, and the crypto market has been consolidating since. Bitcoin's break above $70K might signify the start of the bullish season.
Tech stocks are also experiencing healthy growth, with $ARM up by 5.5% between May 31 and June 3 and $MGNI up by 8.4% in the same period.
Rumors about the September Fed rate cutscould have contributed to Bitcoin's rise and tech stocks soaring. Inflation in the US, coupled with a softer job openings market, seem to be driving prices upward for the entire crypto industry.
Let's discuss why this is happening and what it could mean for the wider economy.
Bitcoin's Longest Daily Run Since March - A Good SignBitcoin recorded its longest winning streak since Marchthese past few days, which means it had consistent daily increases without sharp follow-up drops.
Source: MoneyWebThis led to steady daily growth for several other cryptocurrencies, such as:
The total crypto market cap grew by 2.85% daily and the 24-hour volume by 20.51%, with Bitcoin ETFs also experiencing significant growth in the last 24 hours.
Keith Gill's return to X and GME soaring again are also worth mentioning, as they led to a meme coin frenzy.
Bitcoin's break above $70K seems like the conclusion of a string of events that have impacted traditional and crypto finances alike.
The SEC Sows Confusion Around Ethereum and the Crypto SpaceThe crypto industry is often influenced by political discussions and financial debates.
On April 26, Consensys, the company behind MetaMask and founded by one of Ethereum's co-founders (Joe Lubin), sued the SEC.
The SEC has no authority-nor should it-to regulate global, peer-to-peer computer networks. The SEC's aggressive overreach into commodities, software, and these novel technology platforms is unlawful.ConsensysThe SEC had informed Consensys that MetaMask turned the company into an unregistered securities broker.'
Furthermore, Joe Lubin claimed the SEC had been trying to reclassify Ethereum as a security for a long time, hinting at deliberate abuse from the SEC.
At the same time, the approval of $ETH ETFs shows the SEC's contradictory position on Ethereum.
One might say this is an ad hoc approach to crypto assets that creates significant FUD and volatility in the market.
Fed Interest Rate Cuts & US Inflation Benefit CryptoThe hearsay around the Fed's interest rate cuts (which might be false) is also a likely contributor to Bitcoin's recent spike.
Lower interest rates push investors to seek riskier assets like crypto to pursue higher ROI.When interest rates plummet, people can save more money and start investing in riskier opportunities like crypto.
That's why crypto markets are inversely correlated with interest rates. When interest rates increase, crypto prices tend to fall since there's less demand.
US inflation is currently 3.36%, higher than the long-term average of 3.28%, and crypto is traditionally used as a hedge against inflation.
High inflation tends to push investors toward crypto, whether it's Bitcoin or riskier investments like meme coins. Bitcoin is particularly attractive to some investors who favor it over altcoins and meme coins.
The Verdict - Is Bitcoin Going Bullish?Bitcoin's rush past $70K doesn't seem like a fluke; more like the result of multiple macroeconomic factors such as:
- $BTC ETF approval on January 10, 2024
- $ETH ETF approval on May 24, 2024
- High US inflation
- Rumors of Fed interest rate cuts
- The Bitcoin halving
Whether it surpasses its ATH of $73,700 from March remains to be seen. But a bull run might be in store, given all the underlying aspects discussed.
Crypto is inherently volatile and risky, so we encourage you to DYOR and invest responsibly.
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