Bitcoin and other cryptocurrencies maintained their positions on Thursday, holding onto the majority of their recent gains. This rally has propelled prices to new heights, supported by several factors that are driving the momentum behind digital assets.
In the past 24 hours, Bitcoin remained relatively flat at $43,750 after briefly surpassing $44,000. This marks the highest price for the leading cryptocurrency since April 2022 when the crypto market experienced a significant downturn. Bitcoin's impressive surge of two-thirds since mid-October has put an end to a period of subdued trading, fueling speculation about the start of a new crypto bull market.
Several factors have contributed to Bitcoin's ascent to 20-month highs. Market optimism revolves around the potential approval of the first spot Bitcoin exchange-traded fund (ETF) by U.S. regulators. This approval is anticipated to stimulate a fresh wave of interest from investors. Additionally, the expectation of significant interest rate reductions next year has also played a role. This trend has benefited not only the stock market but Bitcoin as well, surpassing the performance of even the Dow Jones Industrial Average and S&P 500.
With a robust technical market backdrop and limited token supply, analysts predict further strength in Bitcoin. The key factor will be whether crypto traders who have held onto their digital assets can resist the temptation to take profits following such a remarkable upward trajectory.
Looking beyond Bitcoin, Ether, the second-largest cryptocurrency, experienced a minor decline of 1% to $2,250. On the other hand, smaller tokens or altcoins demonstrated strength. Cardano witnessed a 3% climb, while Polygon experienced a 2% increase. However, memecoins took a hit after an initial period of outperformance earlier in the week, with Dogecoin falling by 7% and Shiba Inu shedding 4%.