Bitcoin has maintained its position above $77,000, following a significant surge earlier in the week to its highest level since early February. The cryptocurrency is currently up by approximately 13.6% in April, putting it on track for its most impressive monthly performance in a year, according to data from CoinGlass.
This rebound comes after a challenging period, during which crypto markets experienced their longest losing streak since 2018, with consecutive monthly declines from October to February. The improvement in the broader macroeconomic landscape has contributed to this turnaround, with U.S. equities staging a strong recovery and the S&P 500 and Nasdaq reaching record highs after briefly entering correction territory earlier in the year. A key driver of this move is the significant growth in the supply of Tether's USDT, the largest stablecoin, which has increased to nearly $150 billion, adding around $5 billion over the past two weeks after a period of stagnation.
This surge in stablecoin supply is crucial, as it acts as a source of liquidity in crypto markets, indicating capital inflows to the crypto market and a positive signal for asset prices. Despite ongoing geopolitical tensions in the Middle East and uncertainty surrounding the Iran war, which have kept oil prices elevated, markets appear to be looking beyond these concerns.
According to Jasper de Maere, an OTC trader at Wintermute, the equities and crypto markets seem to have become desensitized to intricate headlines about the conflict, suggesting a level of fatigue and potential complacency. De Maere noted that strong corporate earnings and resilient equity markets are helping to offset concerns about higher energy costs and geopolitical risks. The next test for bitcoin will come with the April Fed meeting, which may determine whether the current rally is sustained. If institutional demand continues to drive the move, bitcoin may break through the $79,000 level, which could potentially become a support level, paving the way for a higher trading range.