Bitcoin rises with strong momentum, while Dogecoin rallies after Elon Musk's latest mention
Bitcoin climbed for the fourth time in five days as speculators targeted the US$70,000 mark again, driven by increasing enthusiasm for digital assets, as reported by BNN Bloomberg.
Jaime Baeza, managing partner at AnB Investments, stated, “Momentum is strong and the path of less resistance, given all the macroeconomic backdrop, is to the upside.”
Bitcoin, the largest cryptocurrency, increased by up to 2.9 percent to US$68,898, surpassing Wednesday’s levels. This also marks the highest point since July 29. Bitcoin was last seen trading at US$70,000 on June 12.
So far this week, investors have added over US$1.8bn into US exchange-traded funds (ETFs) holding Bitcoin, according to data gathered by Bloomberg. These investment vehicles were first approved in the US back in January.
After hitting an all-time high of US$73,797 in March, driven by optimism that ETF demand would outpace the available tokens, Bitcoin's price later dropped by more than 30 percent by early August. This drop, however, was followed by the current bull market trend.
“Inflows on the ETFs have been incredibly strong this week. Also, between 68k-71k, there’s a lot of options positioning there so could be some short gamma,” explained Shiliang Tang, president of principal trading firm Arbelos Markets.
As investors rush into the options market, dealers providing these contracts must either buy or sell in large volumes to offset their exposures, a process known as ‘gamma hedging.’
Additionally, expectations are growing that the next US presidential administration will be more supportive of cryptocurrencies, whether Vice President Kamala Harris or former President Donald Trump wins the upcoming election.
Matt Maley, chief market strategist at Miller Tabak + Co, noted that “The polls are still very, very close, so investors need to be careful over the coming weeks.”
Harris recently committed to developing a regulatory framework for cryptocurrencies, acknowledging years of complaints from the crypto sector about unclear regulations. Trump, meanwhile, has been reaching out to crypto supporters and is involved in several ongoing crypto-related projects.
“Harris pledged to create a regulatory framework for cryptocurrencies, signaling a more favourable environment for digital assets, regardless of the election outcome,” added Baeza.
Meanwhile, Dogecoin has seen continued gains, thanks in part to a recent reference by Elon Musk during a Trump campaign appearance in Pennsylvania. Dogecoin increased by 6.6 percent on Friday, bringing its weekly rise to about 25 percent.
