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Crypto prices rallied over the weekend.
DreamstimeBitcoin and other cryptocurrencies were rallying on Monday as optimism swept through the digital asset space and stock market alike.
The price of Bitcoin rose 6% over the past 24 hours to $22,400—the highest levels since a selloff in mid-June drove the largest crypto down from $30,000 to as low as $18,000.
“Bitcoin is back above the $20,000 level as Wall Street becomes a little bit more upbeat on risky assets,” said Edward Moya, an analyst at broker Oanda.
Other digital assets were buoyant as well. Ether, the second-largest token, gained 11% to $1,500, similarly hitting the highest levels in more than a month. It was more of the same among altcoins, or smaller cryptos, with Solana rising 7% and Cardano jumping 10%. Memecoins—initially intended as internet jokes—were also strong, as Dogecoin and Shiba Inu surged 7% and 9%, respectively.
Action in the crypto derivatives market suggests that traders have turned firmly bullish on Bitcoin.
The aggregated open interest of Bitcoin futures—which represents the total value locked up into current contracts betting on Bitcoin’s future price—is at one of the highest levels since mid-June. This is a strong signal that traders are jockeying for position as another big move is expected.
In addition, the funding rate for Bitcoin futures is firmly positive for the first time since the beginning of the month, indicating that the most popular bet among traders is that the largest crypto will rise.
Bitcoin’s move higher follows similar action in the stock market, where the Dow and S&P 500 saw their best day in a month last Friday and were climbing again on Monday. While cryptos should, theoretically, trade independently of mainstream financial markets, Bitcoin and its peers have shown to be largely correlated to stocks, and especially to tech stocks.
Equities and cryptos alike suffered last week as red-hot inflation data brought to the fore fears that the Federal Reserve will have to move even more aggressively to tighten monetary policy, risking spurring a recession. But investors seem to have shaken off these concerns, with both stocks and cryptos benefiting.
“The crypto market has seen a relief rally,” said Marcus Sotiriou, an analyst at digital asset broker GlobalBlock. “When the market starts reacting positively to negative news, this is a signal that a local bottom could be in for now.”
Write to Jack Denton at [email protected]
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