Bitcoin is currently trading above $77,000, having reached its highest level since early February earlier in the week. With a 13.6% increase in April, the cryptocurrency is on track for its strongest monthly performance in a year, according to CoinGlass data.
This rebound follows a prolonged downturn, with crypto markets experiencing their longest losing streak since 2018, marked by consecutive monthly declines from October to February. The recent turnaround can be attributed to an improved macroeconomic backdrop, with US equities recovering and the S&P 500 and Nasdaq reaching record highs after briefly entering correction territory. Additionally, the supply of Tether's USDT, the largest stablecoin, has surged to nearly $150 billion, with a $5 billion increase over the past two weeks.
This growth in stablecoins, which act as liquidity in crypto markets, is often seen as a sign of capital flowing into the crypto market, which can be beneficial for asset prices. Despite ongoing geopolitical tensions 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, strong corporate earnings and resilient equity markets are offsetting concerns about higher energy costs and geopolitical risks. De Maere noted that markets seem to have become desensitized to intricate headlines about the conflict, which may indicate a level of fatigue and complacency. The next test for bitcoin will come with the April Fed meeting, which could determine whether the current rally is sustainable. 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.