Bitcoin has maintained its position above $77,000, following a notable surge earlier in the week that marked its highest level since February. This upward trend puts the cryptocurrency on track for a 13.6% gain in April, its best monthly performance in a year, according to data from CoinGlass.
The recovery follows a prolonged period of decline, with crypto markets experiencing their longest losing streak since 2018 from October to February. The improvement in the broader macroeconomic landscape, including a strong rebound in U.S.
equities with the S&P 500 and Nasdaq reaching record highs, has contributed to this turnaround. Additionally, the growth of Tether's USDT stablecoin, which has increased by approximately $5 billion over the past two weeks to nearly $150 billion, is seen as a significant driver. Stablecoins, being tied to fiat currencies like the U.S.
dollar, serve as a source of liquidity in crypto markets, indicating capital flow into the crypto market and a positive signal for asset prices. However, geopolitical uncertainties, particularly regarding the Iran war, continue to affect oil prices.
According to Jasper de Maere, an OTC trader at Wintermute, markets seem to be overlooking these geopolitical risks for now, attributing this to fatigue and complacency. De Maere notes that robust corporate earnings and the resilience of equity markets are offsetting concerns about higher energy costs and geopolitical risks. The upcoming FOMC meeting will be a crucial test for bitcoin's ability to break through the $79,000 level, which is considered a significant structural barrier due to institutional overhead supply. Whether bitcoin can sustain its current rally depends on the driving forces behind the move and the participation of institutional buyers.
A breakout supported by sustained institutional demand could mark a durable shift, whereas moves driven primarily by short covering may fade once momentum cools.