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What factors are contributing to Bitcoin’s recovery? A summary of today’s developments in cryptocurrency.
Bitcoin increased by 1.75% in the last 24 hours, reaching $123,250 at the time of reporting, fueled by ongoing spot ETF inflows, gold’s ascent to new highs, and more lenient guidance from the Federal Reserve regarding interest rates.
According to Farside Investors, US spot Bitcoin ETFs recorded $2.1 billion in net inflows from October 6 to October 7. This trend extended a seven-day series of positive inflows as of October 7.
On October 7 alone, the funds attracted $875.6 million, even as Bitcoin faced a 2.4% decline and briefly dipped below the $121,000 mark before the market recovered.
The persistent demand from ETF channels provided a support level for the price and underscored institutional interest in regulated investment vehicles.
Moreover, gold’s rise above $4,000 per ounce reinforced the narrative surrounding hard assets, which often boosts Bitcoin alongside precious metals.
This movement affirmed the “debasement trade” theory, suggesting that investors shift capital into limited assets when worries about government debt and currency reliability emerge. Consequently, the gold surge contributed to Bitcoin’s upward movement.
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The strength of the dollar, influenced by increasing yields on Japanese government bonds, intermittently limited upward momentum. However, the collective hedge demand mitigated that pressure.
New Federal Reserve minutes released on October 8 indicated that further rate cuts in 2025 are still a possibility, maintaining light pressure on real rates and bolstering risk appetite.
The softer tone in the documents alleviated worries about stricter financial conditions, allowing both equities and cryptocurrencies to progress.
Lower real yields diminish the opportunity cost of holding non-yielding assets like Bitcoin, enhancing the appeal of this trade compared to cash and short-term bonds.
The wider cryptocurrency markets mirrored Bitcoin’s gains, with Ethereum rising 1.4% to $4,514.72, XRP increasing by 1.9% to $2.90, Solana advancing 4.2% to $229.52, and Dogecoin gaining 5% to reach $0.2594.
Cardano saw a 2.3% increase, trading at $0.8387, while BNB rose by 1% to $1,316.87.
The interplay of ETF inflows, favorable macroeconomic factors, and gold’s record performance established conducive conditions for Bitcoin to rebound from its recent decline.
The post Why is Bitcoin recovering? Everything that happened in crypto today appeared first on CryptoSlate.
