Bitcoin has maintained its position above $77,000, following a notable surge to its highest level since early February. This upward trend puts the cryptocurrency on track for its most substantial monthly gain in a year, with a 13.6% increase in April, according to data from CoinGlass. The recovery follows a prolonged period of decline, with crypto markets experiencing their longest losing streak since 2018, marked by consecutive monthly drops from October to February.
The turnaround is attributed to an improved macroeconomic backdrop, with U.S. equities recovering and the S&P 500 and Nasdaq reaching record highs after briefly entering correction territory. A significant factor contributing to the crypto market's resurgence is the substantial growth of Tether's USDT, the largest stablecoin, which has expanded its supply to nearly $150 billion, adding approximately $5 billion over the past two weeks.
This surge in stablecoin supply acts as a liquidity injection into crypto markets, signaling increased capital flow and a positive indicator for asset prices. Despite ongoing geopolitical tensions and uncertainty surrounding the Iran conflict, markets appear to be shifting focus away from these concerns.
According to Jasper de Maere, an OTC trader at Wintermute, strong corporate earnings and resilient equity markets are offsetting worries about higher energy costs and geopolitical risks. The upcoming FOMC meeting will be a crucial test for the current rally, with the potential to either sustain or reverse the momentum.
Institutional demand and the direction of the move will be key factors in determining whether bitcoin can break through the $79,000 level, which has proven to be a significant resistance point.