Bitcoin has made an impressive 22% gain over the past week. The coin has held above $21K in the last two days. The gains made by Bitcoin since the beginning of the year have seen the coin going back to the levels it was trading at before the market crashed after the collapse of FTX.
Bitcoin recovers from losses made since FTX collapse
Since the beginning of the week, Bitcoin has held levels above $21K, which is higher than the price at which the token was trading on November 2 of $20,283. Between November 7 and 8, as news of FTX’s financial woes spooked the market, Bitcoin dropped by double-digits. The coin dropped below $16K as a potential Binance bailout failed.
The troubles facing FTX started on November 2 after CoinDesk revealed the gaps in the balance sheet of FTX’s sister company, Alameda Research. The news, alongside a tweet by Binance’s CEO Changpeng Zhao about liquidating his entire stake in FTX, triggered massive withdrawals from FTX.
FTX later filed for bankruptcy on November 11 after failing to fulfill withdrawals. During FTX’s fallout, Bitcoin’s volatility spiked as concerned investors started selling, causing the token to drop further.
Bitcoin is the top weekly gainer among the top ten largest cryptocurrencies by market capitalization. Bitcoin is up by 22% in the past week, while Ether has gained by 18%. BNB and XRP have gained by 7% and 6%, respectively. Cardano, Dogecoin, and Polygon are up by 9%, 11%, and 14%, respectively. Solana has outperformed the top ten coins with 40% gains in the last week.
It is likely for Bitcoin to sustain the uptrend because of the sentiment across the cryptocurrency market. The recent inflation data in the US revealed that inflation levels were easing, and they now stand at 4.5%. The inflation report could trigger gains for Bitcoin if the Federal Reserve eases the hike on interest rates.
On the other hand, the stock market is gaining amid much buzz around China’s reopening. Bitcoin was largely correlated to the stock market before the demise of FTX, and with the prices back to pre-FTX bankruptcy, a rally in stocks could translate to more gains for BTC, and the coin will rally past $30K.
Bitcoin rallies despite market uncertainty
There has been much uncertainty around the recent gains made by Bitcoin, with investors wondering whether the coin will sustain the current price growth. The US Securities and Exchange Commission (SEC) filed charges against Genesis Trading and the Gemini exchange for issuing unregistered securities through their Gemini Earn product.
This year, multiple layoffs have also been reported on cryptocurrency exchanges such as Crtypto.com and Coinbase. Multiple crypto firms laid off employees last year amid bearish market conditions.
Digital Currency Group, one of the largest crypto conglomerates, has also suspended dividends. The company has announced that it will be halting dividends until further notice. DCG is the parent company of Genesis.
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