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On October 6, Bitcoin (BTC) surpassed $126,100 for the first time ever, rising 2.5% within 24 hours as unprecedented institutional interest and macroeconomic instability combined to propel it to new peaks.
Since then, Bitcoin has retraced to $123,500, hovering around the previous all-time high, which now serves as a support level for the upward trend.
This surge followed $3.55 billion in net inflows into US spot Bitcoin exchange-traded funds (ETFs) last week, contributing to nearly $6 billion in total cryptocurrency inflows that restricted available supply and bolstered prices.
The significant institutional purchases through regulated products removed Bitcoin from circulation, exerting upward pressure on spot markets.
Macroeconomic elements intensified the movement as concerns over a US government shutdown directed investors towards perceived hedges such as Bitcoin and gold.
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The shutdown worries enhanced Bitcoin’s attractiveness as a safe-haven asset alongside traditional defensive investments, while the strength of equity futures and a broader risk appetite provided additional support.
Traders are looking forward to the Federal Reserve’s announcements later this month for indications of a more dovish monetary policy trajectory, which could further bolster risk assets, including cryptocurrencies.
Ethereum also rose alongside Bitcoin, crossing $4,700 and trading at $4,643.91 at the time of reporting, marking an 11% increase over the past week. The wider cryptocurrency market experienced gains across major assets as the Bitcoin rally improved overall sentiment.
BNB reached a peak of $1,243, up 4.1% in 24 hours. Cardano increased by 5.2% to $0.8783, while XRP rose 3% to $3.04. Solana advanced 3.7% to $236.30. Dogecoin saw significant gains among major cryptocurrencies, surging 6.1% to $0.2687.
The combination of institutional demand through ETFs, macroeconomic uncertainty prompting safe-haven flows, and positive risk sentiment in traditional markets created an environment for Bitcoin to surpass the $126,000 mark.
The post Bitcoin crosses $126,000: Why did BTC reach a new all-time high? appeared first on CryptoSlate.
