Bitcoin gains for eighth straight day to reclaim $58,000 level

NEW DELHI: Bitcoin rose for the eighth straight session on Friday to reclaim the $58,000 level, recovering from a recent sell-off that had pulled down prices to as low as $43,000.

Gains have come on the back of the US passing a $1.9 trillion covid-19 stimulus package, which is expected to boost prices of crypto assets.

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“Most Americans will receive $1,400 worth stimulus checks this week. Historically, every time stimulus checks have hit people’s bank accounts, we’ve seen more buying in the crypto market. Economically speaking, bitcoin also goes up when there is more inflation of the dollar. It also becomes weaker against the US dollar every time the US Federal Reserve prints more dollars. There’s a high probability that bitcoin bulls will be in control in the coming week,” said Siddharth Menon, co-founder and COO, WazirX.

The dollar has also risen recently amid renewed optimism about economic growth prospects in the US, as covid-19 vaccines are administered.

However, according to global crypto exchange Kraken, while some experts were expecting a rally in the dollar to lead to a downward pressure on Bitcoin, the bottoming out of the US greenback and its latest rally is yet to translate to weakness for the crypto asset. “Perhaps, we’re just starting to see the dollar regain its strength and the trouble for BTC is around the corner, meaning that the bulls will struggle to continue setting higher-highs. For now, we’ll just have to be patient and wait and see what happens,” Kraken said.

Bitcoin traded at $56,808.17 at 1715 IST, up 1.4%, having moved in the range of $55,701.57-58,102.28 in the past 24 hours, as per CoinGecko. The crypto asset, with a market capitalisation of $1.06 trillion, is around 3.1% away from its lifetime high of $58,640.77.

“Many international institutional investors, private wealth management firms, and conglomerates are heavily investing and adding bitcoin into their business operations, which are pushing the bitcoin price higher. In the near term, we anticipate the price to touch $60,000 since this time the demand is not only retail-driven but is being backed by institutional investors,” said Sumit Gupta, CEO and co-founder, CoinDCX.

Meanwhile, the world’s second-biggest cryptocurrency, Ethereum traded at $1,777.16, down 0.4%. The digital currency is around 13% lower than its all-time high of $2,042.93.

According to Kraken, even as altcoins have outperformed over the past 30 days with a return of 36% against Bitcoin’s 24% gain, this week has been a turning point for the latter. “While BTC’s move up to $58,000 puts it within striking distance of its previous local high set on 20 February, many altcoins have yet to bounce back after retracing anywhere from -30-60% just a few weeks ago,” it added.

Altcoins is a cumulative term to define cryptocurrencies that came after Bitcoin.

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