Bitcoin Reenters $70,000
Revived US September Rate Cut Speculation
Europe Likely to Cut Rates This Month
US Political Climate Turns Pro-Crypto
Analysis Predicts Rally Through Year-End
Amid expectations of interest rate cuts in the United States and Europe, the prices of cryptocurrencies such as Bitcoin are on the rise. As the U.S. political sphere, mindful of voters, shows a pro-cryptocurrency stance, there are also predictions that cryptocurrencies could embark on a rally through the end of the year.
According to Investing.com on the 5th, as of 8:06 a.m., the price of one Bitcoin was trading at $70,565, up 2.21% from 24 hours earlier, and at one point surpassed $71,000. The price of Ethereum, ranked second in market capitalization, also showed a slight upward trend.
Bitcoin breaking through the $70,000 level is the first time in 14 days since the 21st of last month. At the same time, on the domestic exchange Upbit, Bitcoin was trading at 97.65 million KRW per coin, approaching re-entry into the 100 million KRW range.
Bitcoin had been in a sideways trend since reaching an all-time high of $73,798 in March, buoyed by the U.S. Securities and Exchange Commission’s approval of spot exchange-traded funds (ETFs).
The upward trend was driven by a reduced likelihood of decoupling in monetary policy between the central banks of the United States and the European Union (EU). Until now, the market had expected Europe, which has controlled inflation and experienced a mild recession, to cut interest rates this month, while the U.S. might not lower rates within the year. However, the U.S. job openings last month fell to the lowest level in 3 years and 2 months, reviving expectations of a rate cut in September.
Interest rate cuts by the U.S. and EU tend to lower the value of the dollar and euro, increasing the appeal of risk assets like cryptocurrencies. Investors holding these currencies tend to sell them before their value drops and buy cryptocurrencies in advance as a hedge.
Among this, major players offering ‘rosy forecasts’ for cryptocurrencies are also attracting attention.
According to Bloomberg, Michael Novogratz, CEO of Galaxy Digital, stated that considering the U.S. political environment, which is turning favorable toward digital assets, Bitcoin’s price could exceed $100,000 by the end of this year. This is due to the accumulation of donations to congressional candidates supporting cryptocurrencies and the fact that President Joe Biden and former President Donald Trump, mindful of voter sentiment ahead of the November election, are adopting a stance of regulatory easing toward cryptocurrencies.
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