:max_bytes(150000):strip_icc()/GettyImages-2255549216-ff647873576b41a5aaceb35fab206e3b.jpg "Bitcoin Is on the Rise Again. Why Some Experts Think This Might Last a While")
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Key Takeaways
- Stable inflation and movement in crypto legislation has helped boost digital asset prices, according to experts.
- Shares of crypto-linked stocks including Coinbase and Strategy are echoing bitcoin’s recent price gains.
Bitcoin has broken out. Can this continue?
The world’s largest cryptocurrency started to climb meaningfully higher on Tuesday after the Bureau of Labor Statistics’s report yesterday showed that inflation remained relatively stable at the end of last year. Bitcoin has risen more than 4% in the past 24 hours to above $97,000, levels not seen since mid-November, according to data firm Messari.
Crypto-linked stocks, including Coinbase (COIN) and Strategy (MSTR), are up almost 3%, and more than 6%, respectively, as of Wednesday afternoon. The rally appears to have legs, according to some digital asset experts. “This momentum continues in the coming days,” Sean Farrell, Fundstrat’s head of digital asset strategy, wrote yesterday.
WHY THIS MATTERS TO YOU
Bitcoin’s lackluster performance last year had some digital asset investors on edge. Some crypto watchers think the latest price action could renew interest in the cryptocurrency.
Consensus views for lower interest rates this year—generally viewed as good for risk assets like bitcoin—could get “priced back into the market” in the coming months: The Bureau of Labor Statistics’ report on inflation yesterday showed prices stabilizing, and if inflation remains contained then the Federal Reserve may be more inclined to lower rates.
Crypto investors also appear to be cheering the possibility of a key piece of crypto legislation getting passed. LMAX Group’s market strategist Joel Kruger yesterday said that regulatory developments are “helping support sentiment.”
That bitcoin has broken above the $95,000 level, a “zone that carries both technical and psychological significance,” suggests that the coin could continue to climb, Kruger added.
Passage of the Clarity Act, which would establish a broad regulatory framework for digital assets, isn’t in the bag, though; the Senate postponed its planned markup of the bill this week to the last week of January, signaling that it doesn’t yet have the votes necessary to advance it.
Meanwhile, renewed optimism around crypto may be helping lift some smaller stocks. High Roller Technologies (ROLR), an online casino operator, on Wednesday saw its shares rocket several times higher following the announcement of a partnership with Crypto.com to offer a prediction markets product in the U.S.
