The price of bitcoin jumped Monday following a slew of bullish developments for the cryptocurrency, even as investors continue to monitor developments in the war in Ukraine and moves by the Federal Reserve.
Bitcoin extended gains from a late Sunday rally, when the cryptocurrency broke past the key level of $45,000 and erased its losses for 2022. It last traded more than 6% higher at $47,620.75, according to Coin Metrics. Earlier in the day it touched $47,754.31, its highest level since Jan. 2.
The digital currency has been rising since Friday, gaining nearly 7% in that time.
While there isn’t one particular catalyst for the moves, there have been several bullish developments for bitcoin in the past week alone showing evidence of institutional demand for more exposure to the digital asset.
For example, Goldman Sachs last week became the first major U.S. bank to trade bitcoin over the counter, and Cowen said it will soon allow institutional clients spot bitcoin trading. Ray Dalio’s Bridgewater has also said it’s about to make an investment into a crypto fund.
“The ongoing capital splash into the digital currency is a sign that investors do not want to take a back seat in a price movement that could push bitcoin to a height not seen since November 2021,” said Alexander Mamasidikov, co-founder of the mobile digital bank MinePlex.
Terra, the network behind the Luna token, is also building a $10 billion bitcoin reserve fund for its stablecoin TUSD. It has been buying more bitcoin for it each day, including more than $100 million in bitcoin on Monday.
Yuya Hasegawa, crypto market analyst at Japanese bitcoin exchange Bitbank, noted that the bitcoin futures market was accumulating short positions when the price fluctuated below $40,000, which resulted in about $71 million in liquidations on Sunday.
“From a technical perspective, bitcoin has broken out of an ascending triangle, which signals an upward trend, and likely will continue to rally in the short term,” he said.
He added the market should proceed with caution ahead of the Personal Consumption Expenditures report and jobs report later this week, noting that the results could lead to a 50 basis point rate hike at the next FOMC meeting. Last week, Fed chair Jerome Powell vowed to be tough on inflation and said rate increases could become more aggressive if necessary.