BackBitcoin soared above $30,000 for the first time since June 2022, marking an impressive rally of over 80% since the beginning of the year. The digital token's rebound has outpaced the nearly 20% gain on the Nasdaq 100, an index it has often moved in tandem with, and has helped recover some of the losses from the crypto-related crashes in 2022. However, Bitcoin is still over 50% below its all-time high, which was reached in November 2021.
Mati Greenspan, CEO of Quantum Economics, emphasized the significance of crossing the $30,000 threshold, stating, "The resistance has been building up for three weeks straight and has now finally broken. This is the first time we've crossed that level since the collapse of Terra/Luna and Three Arrows Capital. It basically means that the price has fully recovered from Celsius, FTX, and the US regulatory crackdown."
The surge above the $30,000 resistance level follows a "squeeze" of the Bollinger Band, with historical volatility dropping to its lowest since January. A similar compression in the past led to a sharp upward movement, resembling Tuesday's breakout. Technical pattern-focused traders may now set their sights on $30,800 as the initial target, followed by $31,200.
However, the crypto industry continues to face intense scrutiny. The US Securities and Exchange Commission (SEC) has informed Coinbase Global of its intent to launch an enforcement action against the crypto exchange. The SEC has also sued crypto magnate Justin Sun for allegedly violating securities regulations, a claim Sun denies.
Furthermore, the US Commodity Futures Trading Commission has sued Binance founder Changpeng Zhao and his crypto exchange for purported violations of derivatives regulations. Binance disputes many of the agency's assertions.
Despite these obstacles, Bitcoin's rally has gathered momentum over the past month, following the collapse of three US banks. This has reignited the narrative among Bitcoin proponents that the digital token presents a more appealing alternative to traditional finance.
Some analysts attribute the rebound to a decrease in liquidity to a 10-month low, following market makers losing access to US banking rails provided by Silvergate Capital Corporation and Signature Bank. This lower trading volume can make price swings appear more dramatic.
Strahinja Savic, Head of Data and Analytics at FRNT Financial, commented on the thin order books and depressed trading activity, stating, "Under these circumstances, it is possible that we see price action that is difficult to pin to any one reason."
As Bitcoin surpasses the $30,000 mark for the first time in months, it showcases resilience amid regulatory challenges and reinvigorates the belief in its potential as an alternative to traditional finance. However, the cryptocurrency landscape remains highly uncertain, and further developments in the industry will shape the trajectory of Bitcoin and other digital tokens.
