Bitcoin has maintained its position above $77,000, following a notable surge to its highest level since early February. With a 13.6% increase in April, the cryptocurrency is on track for its most impressive monthly performance in a year, according to data from CoinGlass. This rebound comes after 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 the improving macroeconomic backdrop, with US equities, including the S&P 500 and Nasdaq, recovering to record highs after briefly entering correction territory. A significant factor contributing to the move is the substantial 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, as it acts as liquidity in crypto markets, signaling the flow of capital into the crypto market and potentially driving asset prices higher.
Despite persistent 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, 'equities and crypto markets seem to have stopped caring about intricate headlines on the conflict's direction,' indicating a level of fatigue and potential complacency. Strong corporate earnings and resilient equity markets have helped offset concerns about higher energy costs and geopolitical risks.
The upcoming FOMC meeting will be a crucial test for the current rally. If institutional demand persists, bitcoin may break through the $79,000 level, potentially marking a more durable shift, while a move driven mainly by short covering may fade once momentum cools.