Bitcoin has maintained its position above $77,000, following a significant surge earlier in the week, and is now poised for its strongest monthly gain in a year, with a 13.6% increase in April, according to CoinGlass data. This rebound comes after a prolonged period of decline, with crypto markets experiencing their longest losing streak since 2018, marked by consecutive monthly losses from October to February. The improvement in the broader macroeconomic landscape has contributed to this turnaround, with US equities, including the S&P 500 and Nasdaq, reaching record highs after a brief correction earlier in the year.
A key driver of this move is the significant growth in Tether's USDT, the largest stablecoin, which has increased its supply to nearly $150 billion, adding approximately $5 billion over the past two weeks. This surge in stablecoin supply is seen as a positive indicator for the crypto market, as it provides liquidity for traders to purchase digital assets. Analysts view stablecoin growth as a signal of capital flowing into the crypto market, which can lead to higher asset prices.
Despite ongoing geopolitical tensions in the Middle East and uncertainty surrounding the Iran conflict, markets appear to be looking beyond these concerns, with strong corporate earnings and resilient equity markets helping to offset worries about higher energy costs and geopolitical risks. 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, indicating a level of fatigue and potential complacency. The next major test for bitcoin will be the upcoming 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 mark a more durable shift, according to Adam Haeems, head of asset management at Tesseract Group.