Bitcoin Surges to Yearly High, Eyes $40,000 Mark
Bitcoin has broken out, reaching a yearly high of about $39,900. This surge has prompted market observers to suggest it might surpass the $40,000 mark very soon. The recent price increase follows a speech by Jerome Powell, Chair of the United States Federal Reserve, hinting at continued restrictive rates until inflation aligns with their 2% target.
Post-Powell’s speech, Bitcoin touched a 19-month high, buoyed by market optimism and speculation regarding the Fed’s future direction. Some analysts, noting this uptrend, believe Bitcoin could breach the $40,000 mark and march toward $50,000. Markus Thielen of Matrixport, in a note to investors, posited a 90% chance of Bitcoin reaching $45,000. He attributes this to market positivity and the potential approval of a spot exchange-traded fund (ETF).
In recent months, traditional financial institutions, like BlackRock, have sought a spot Bitcoin ETF from the US Securities and Exchange Commission (SEC). This development, coupled with active engagement from the SEC, fuels expectations of an imminent Bitcoin ETF approval. Notably, Grayscale is preparing for such approval by appointing John Hoffman, formerly of Invesco, to lead its Bitcoin ETF efforts.
Further bolstering the bullish sentiment is on-chain data indicating a significant withdrawal of Bitcoin from exchanges. According to Glassnode, more than 37,000 BTC have been moved off exchanges since November 17. This trend is generally seen as a bullish signal, suggesting a shift towards long-term holding and less selling pressure.
Moreover, the recent price surge has brought Bitcoin holders to their most profitable levels since December 2021. Data provider IntoTheBlock notes that over 80% of Bitcoin addresses are now holding at a profit.
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