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Analysis: What’s behind bitcoin’s latest surge?

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Analysis: What’s behind bitcoin’s latest surge?

LONDON, March 22 (Reuters) – On the flip of the yr, bitcoin was within the grip of a bleak midwinter, down and out after a 2022 outlined by tumbling crypto costs, bankruptcies and company scandals.

Lower than three months later, bitcoin’s obtained its mojo again. With positive factors of greater than 70% to this point this yr, it has outpaced different main belongings, and was on Wednesday buying and selling close to its highest in 9 months.

The unique and largest cryptocurrency has been right here earlier than, its 15-year historical past peppered with dramatic value will increase and equally vertiginous drops. Fuelling the positive factors: rates of interest.

Markets anticipate that central financial institution hikes to the price of credit score are nearing their peak, and such a state of affairs is about to buoy risk-on belongings equivalent to bitcoin, six traders and analysts from crypto and conventional finance advised Reuters.

“The macro narrative is the primary,” stated Noelle Acheson, an economist who has tracked the crypto sector for seven years. “Bitcoin isn’t just a threat asset, it’s arguably probably the most delicate to financial liquidity out of all the threat belongings.”

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Different components are at play, too, from turmoil within the banking sector to enduring hopes – nonetheless unfulfilled – that bitcoin can obtain vast utilization as a type of cost.

Bitcoin closed its greatest week in 4 years on Sunday, and has gained 45% in simply 12 days.

Because the collapse of U.S. lenders Silicon Valley Financial institution and Signature Financial institution helped to triggered the takeover on Sunday of 167-year-old Credit score Suisse by rival UBS, claims that bitcoin is an asset resistant to dangers in conventional finance have gained traction.

“It is quite narrow-minded to say that bitcoin goes to succeed as a result of a financial institution failed,” stated Usman Ahmad, CEO of Zodia Markets, the crypto alternate of the enterprise arm of Commonplace Chartered (STAN.L) and Hong Kong crypto agency BC Know-how Group.

“However confidence is nearly a important issue – confidence within the banking system has been broken.”

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Driving bitcoin’s positive factors have been its core consumer base of retail traders, analysts stated. Institutional traders equivalent to pension funds, till now cautious of the unstable and largely unregulated bitcoin, are prone to stay sceptical of a long-lasting renaissance for the cryptocurrency, the interviews confirmed.

“Bitcoin’s current bull run appears to be like to be primarily supported by particular person traders – starting from retail to whales – as we’ve got seen proof of establishments exiting throughout this rally,” stated Zhong Yang Chan, head of analysis at crypto information agency CoinGecko.

Certainly, bitcoin funding merchandise, favoured by bigger traders, noticed outflows of $113 million final week, in response to digital asset supervisor CoinShares, which ascribed the strikes to a scramble for liquidity throughout chaos within the banking sector.

DEJA VU?

Prior to now, too, dramatic value swings for bitcoin have been intently tied to shifts in financial coverage globally.

As stimulus measures flooded the worldwide monetary system through the COVID-19 pandemic, stay-at-home traders fuelled a six-fold rally for bitcoin between September 2020 and April 2021.

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These strikes, allied with rising curiosity in crypto from bigger traders and firms, led crypto backers to vow that its possibilities of a bruising crash traditionally seen after bitcoin rallies had been decrease.

But as indicators of runaway inflation late in 2021 pressured central banks and governments to curb stimulus packages, bitcoin slumped by greater than half from its file excessive of $69,000 in simply 75 days as charges started to rise.

In 2022, bitcoin plummeted over 65% as greater charges triggered the autumn of a significant crypto token, precipitating the closure of main hedge funds and crypto lenders. It was additional bruised by regulatory complications and the dramatic fall of the FTX alternate.

The disastrous yr was one other reminder of bitcoin’s vulnerability to exterior shocks, regardless of backers’ claims it’s a secure haven asset in instances of political and financial stress.

To make sure, some traders say developments to bitcoin’s intrinsic traits are actually able to supporting its value. Richard Galvin of crypto fund Digital Asset Capital Administration, as an illustration, cited software program upgrades which have enabled a brand new breed of non-fungible tokens on bitcoin.

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Nonetheless, for traders in conventional belongings, doubts stay.

“I do not know if old-school forex individuals are reassessing it,” stated Stephen Gallo, European head of FX technique at BMO Capital Markets. “We’re nonetheless battling bitcoin on the definition of a forex.”

Reporting by Tom Wilson, Modifying by Louise Heavens

Our Requirements: The Thomson Reuters Belief Ideas.

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Attorney General Jackson and Secretary of State Marshall Launch Crypto Scams Prevention Effort

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Attorney General Jackson and Secretary of State Marshall Launch Crypto Scams Prevention Effort
FOR IMMEDIATE RELEASE Tuesday, July 15, 2025 Email: bconroy@ncdoj.gov Phone: 984-383-9038 RALEIGH – Attorney General Jeff Jackson and Secretary of State Elaine Marshall joined AARP, the Wilmington Police Department, and United Way NC/NC 211 to launch a statewide effort to help prevent bitcoin and cryptocurrency ATM scams. Victims of these scams can lose well over […]
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Bank of America Embraces On-Chain Data Analysis for Cryptocurrency Insights

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Bank of America Embraces On-Chain Data Analysis for Cryptocurrency Insights

Bank of America has been discreetly preparing for potential disruptions in the cryptocurrency market by focusing on on-chain data analysis. This strategic move is aimed at better understanding the volatile nature of digital currencies and gaining deeper insights into market trends, investor behavior, and potential risks. The bank has been conducting extensive research and analysis on blockchain data, which allows for a more granular understanding of the market compared to traditional financial metrics.

By analyzing blockchain data, Bank of America can track transactions, monitor wallet activity, and assess the overall health of the cryptocurrency ecosystem. This approach enables the bank to make more informed decisions and mitigate risks associated with the cryptocurrency market. The shift towards on-chain data analysis reflects a broader trend within the financial industry, as institutions increasingly recognize the need to integrate blockchain analysis into their risk management strategies.

This proactive approach by Bank of America underscores its commitment to staying ahead in an ever-evolving financial landscape. The bank’s efforts are part of a larger initiative to enhance its capabilities in the digital asset space. By leveraging on-chain data, Bank of America aims to provide more comprehensive and accurate assessments of the cryptocurrency market, thereby better serving its clients who are increasingly interested in digital currencies and blockchain technology.

The move by Bank of America to focus on on-chain data analysis is a significant development in the financial industry. It highlights the growing importance of blockchain technology and the need for financial institutions to adapt to the changing landscape. As the cryptocurrency market continues to evolve, Bank of America’s proactive approach positions it well to navigate the challenges and opportunities that lie ahead. This strategic shift not only enhances the bank’s risk management capabilities but also demonstrates its readiness to embrace the future of finance.

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House Votes on Key Cryptocurrency Bills This Week

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Bank of America Embraces On-Chain Data Analysis for Cryptocurrency Insights

The U.S. House of Representatives is poised to vote on several pivotal cryptocurrency bills this week, marking a crucial juncture in the regulatory evolution of digital assets. The legislative package under consideration includes the CLARITY Act, the GENIUS Act, and the Anti-CBDC Surveillance State Act, each addressing distinct facets of the cryptocurrency ecosystem to foster a more structured and transparent market.

The CLARITY Act, formally known as the Digital Asset Market Clarity Act of 2025, is designed to establish clear, functional requirements for participants in the digital asset market. This legislation aims to enhance consumer protection while encouraging innovation, ensuring that the market operates within a well-defined regulatory framework. The GENIUS Act, meanwhile, focuses on stablecoin regulations, offering a comprehensive approach to managing these digital assets. The Anti-CBDC Surveillance State Act seeks to prohibit the Federal Reserve from issuing a central bank digital currency (CBDC), underscoring the importance of privacy and individual control over financial transactions.

The White House has highlighted the significance of this legislative push, with digital asset adviser Bo Hine referring to it as “Crypto Week.” This initiative is part of a broader effort to integrate cryptocurrencies into the mainstream financial system, balancing the need for regulation with the potential for innovation. The House Committee on Financial Services, led by Chairman French Hill, has been at the forefront of this agenda, emphasizing the importance of these bills in providing a clear regulatory framework for digital assets. This framework is essential for both consumer protection and market stability, and the committee’s efforts have garnered support from various stakeholders, including industry experts and policymakers.

The voting process is anticipated to attract close scrutiny from industry participants and regulators, as the outcomes will have wide-ranging implications for the future of digital assets in the U.S. The CLARITY Act is particularly notable, as it is seen as a foundational element of the regulatory framework, offering much-needed clarity on the legal status of digital assets and the responsibilities of market participants. The GENIUS Act and the Anti-CBDC Surveillance State Act complement this effort by addressing specific areas of concern within the cryptocurrency ecosystem.

As the House of Representatives prepares to vote on these bills, the focus remains on creating a balanced regulatory environment that supports innovation while protecting consumers. The outcomes of these votes will significantly influence the future trajectory of digital assets in the U.S., setting the stage for further developments in this dynamic and rapidly evolving field.

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