Despite the tense mood on the stock market, the crypto market continued to grow over the weekend. Bitcoin, the largest digital currency by market value, rose to over $27,000 on the Bitstamp trading platform. This is the highest level since June.
Since the beginning of the week, the price has already increased by about a quarter. Other crypto assets like Ethereum also gained at the end of a tumultuous week. The market value of all nearly 23,000 cyber currencies was approximately $1.14 trillion.
Moderate setbacks due to banking turmoil
Despite recent gains, the crypto market has been weighed down this week by banking turmoil in the US and Europe. However, the setbacks were much more subdued than, for example, in the equity markets or for some classic currencies. This is unusual as digital assets are among the most volatile financial stocks. Cryptocurrencies, on the other hand, were hit hard by the problems at crypto bank Silvergate in early March.
Bitcoin and Co recently received support from the sharply lower capital market interest rates, which also fell on Friday. “The prospect of more prudent monetary policies by central banks on both sides of the Atlantic acts as a tip of the veil into the future,” explains crypto expert Timo Emden.
Interest rate expectations have fallen sharply
Due to the problems in the banking sector, interest rate expectations from central banks have fallen sharply, causing market interest rates to fall. There is even speculation in the US that the US Federal Reserve could start cutting interest rates later in the year. This also contributed to the overall decline in revenues.
Lower interest rates usually benefit riskier asset classes such as digital currencies, as safer assets such as government bonds then pay less interest.
Source: Krone
I’m Ben Stock, a journalist and author at Today Times Live. I specialize in economic news and have been working in the news industry for over five years. My experience spans from local journalism to international business reporting. In my career I’ve had the opportunity to interview some of the world’s leading economists and financial experts, giving me an insight into global trends that is unique among journalists.
