Bitcoin’s value surged past $95,000 amid post-election confidence, as institutions and sovereign wealth funds pour into the market.
After weeks of stagnation, the bitcoin market saw a significant upswing this week, with prices climbing to over $95,000. The 12% increase on the work-week was driven by better macroeconomic news and a sense that the worst of tariff-mania may be behind us.
Bitcoin is a decentralized digital currency that allows for peer-to-peer transactions without the need for intermediaries.
It was created in 2009 by an individual or group using the pseudonym Satoshi Nakamoto.
Bitcoin operates on a blockchain, a public ledger that records all transactions.
The total supply of bitcoin is capped at 21 million coins, and new coins are generated through a process called mining.
As of 2022, over 18 million bitcoins have been mined.
Institutions Fuel the Rally
Coinbase Institutional’s John D’Agostino attributed the rally to institutions and sovereign wealth funds accumulating bitcoin. In contrast, retail traders were exiting bitcoin ETFs. This trend is being fueled by institutions backing bitcoin-accumulation vehicles, such as Strike CEO Jack Mallers and Cantor Fitzgerald’s Brandon Lutnick, who unveiled Twenty One Capital, a new investment company backed by Tether, Bitfinex, and SoftBank.
An institution is a social entity with its own structure and functions, established to achieve specific goals.
It can be a government agency, educational institution, hospital, or non-profit organization.
Institutions provide frameworks for social interaction, governance, and decision-making.
They are often characterized by their stability, continuity, and permanence.
Examples of institutions include schools, courts, banks, and universities.
Market Sentiment Shifts
The options markets show that traders are willing to hold onto BTC through market swings, which explains why bitcoin held relatively steady when stocks and bonds were diving in recent weeks. CoinDesk’s market wizard Omkar Godbole reported on this trend.
Bitcoin’s Growing Importance
Bitcoin became the fifth most-valuable financial asset this week, surpassing Google’s market cap for the first time. This is a remarkable milestone for a protocol that started as a hobby among cypherpunks 20 years ago.
Web3 and Crypto News
In other news, Zora’s much-hyped token launch underperformed on debut. Analysts attributed this to traders being wary of ‘VC tokens’ with relatively little liquidity. On the positive side, rising prices for core crypto assets are opening space for expansive Web 3 ideas. This week saw announcements from the hit British TV series Peaky Blinders launching a blockchain-based video game and Web3 ‘ecosystem.’ Additionally, USDC-issuer Circle announced a new global payments and remittances network.
Web3 is a decentralized internet development movement that aims to create a more secure, transparent, and user-centric online experience.
Building upon the principles of blockchain technology, Web3 enables peer-to-peer interactions without the need for intermediaries.
Key features include decentralized data storage, token-based economies, and open-source protocols.
Web3 has gained significant traction in recent years, with many projects focusing on scalability, usability, and interoperability.
Investment Advice
While accumulating bitcoin is not investment advice, it’s hard to go wrong with this strategy. Paying in stablecoins like U.S. dollars and PayPal’s PYUSD also seems like a solid move.
- coindesk.com | CoinDesk Weekly Recap: Finally, the Bitcoin Rally
