Bitcoin’s price surged above US$28,000 in Monday morning trading in Asia, leading a rally among the top 10 non-stablecoin cryptocurrencies. Ethereum also reclaimed the crucial US$1,900 resistance level. This surge in the crypto market can be attributed to an in-principle agreement between President Joe Biden and House Speaker Kevin McCarthy to raise the country’s debt ceiling, which has bolstered investors’ appetite for risk assets. Additionally, U.S. equity futures experienced a positive sentiment on Friday.
Within the last 24 hours, Bitcoin witnessed a 3.98% rise to US$28,195 at 9:30 a.m. in Hong Kong. According to CoinMarketCap data, it achieved a weekly gain of 5.73%, crossing the US$28,000 resistance level for the first time since May 10. Ether, the second-largest cryptocurrency, also saw a significant surge of 3.48% in the past day, reaching US$1,916. Over the past seven days, Ether has climbed 6.53%, breaking through the US$1,900 mark for the first time in three weeks.
The talks surrounding the U.S. debt ceiling played a crucial role in boosting cryptocurrency prices. President Biden announced an in-principle budget agreement with House Speaker Kevin McCarthy, which, if ratified, would suspend the government’s debt limit until January 1, 2025. The urgency to pass this deal by June 5, the debt default deadline set by Treasury Secretary Janet Yellen, has created a sense of relief among investors. Failing to reach an agreement by that date could have devastating consequences for U.S. and global markets.
Markus Thielen, Head of Crypto Research & Strategy at Matrixport, noted that the likelihood of a U.S. government default is extremely low. As a result, investors have redirected their attention to other potential concerns while the market continues to rally. This sentiment has resulted in fresh buying of risk assets, with Bitcoin leading the way and all other top 10 non-stablecoin cryptocurrencies trading higher over the past day.
The overall cryptocurrency market cap increased by 3.00% to reach US$1.17 trillion, accompanied by a 57.01% surge in 24-hour trading volume to US$31.73 billion. Among the top 100 cryptocurrencies, Neo, supported by the China-affiliated Neo blockchain and backed by Onchain, experienced the largest weekly gain. Neo’s value rose by 23.83% to reach US$11.37. Investors are positioning themselves for the Hong Kong opening event, as the special administrative region of China plans to unlock trading for retail investors starting from June 1. Hong Kong aims to establish itself as a prominent hub for the crypto industry.
The recent surge in Bitcoin and other cryptocurrencies can be attributed to the in-principle agreement on the U.S. debt ceiling, which has alleviated investor concerns. The market rally is fueled by fresh buying of risk assets, and the positive sentiment has extended to the wider crypto market, pushing the total market cap and trading volume higher. Moreover, the anticipation of Hong Kong’s opening event has contributed to the rise of Neo, positioning the city as a crypto industry hub.
