Macroconomic factors

The bitcoin rate unexpectedly soared to $25,000, returning to the values ​​of August last year. Other leading cryptocurrencies lagged behind in dynamics. Experts attribute the local rise to positive macroeconomic data for the US and the closing of short positions in the market. Analysts see room for further growth in cryptocurrency rates. However, the limiting factor is the decisions of US regulators on stablecoins, which can interrupt the bull market.

According to coinmarketcap.com, February 16, the Bitcoin exchange rate exceeded $25 thousand, having updated the maximum since August 2022. A 24-hour surge of more than 10% looked unexpected, especially given that the cryptocurrency market was dominated by “bears” last week in the absence of positive macroeconomic news (see chart). “Kommersant” dated February 13). The second largest cryptocurrency by capitalization, Ethereum (ETH), rose in price by more than 7% per day and reached $1.73 thousand. Quotes of other digital currencies — Binance Coin, Ripple, Cardano, Dogecoin, Solana — rose by 2–8%.

Experts note macroeconomic reasons for bullish cryptocurrencies.

The growth of the bitcoin rate reflects the positive mood of market participants after the publication of data on a slowdown in consumer price growth in the United States, said Roman Nekrasov, co-founder of the ENCRY Foundation.

Thus, inflation in the US in January slowed down to 6.4%, while in December it was 6.5%. This, according to Mr. Nekrasov, indicates a gradual recovery of the American economy after the pandemic and the inflationary shock of 2022.

At the same time, technical factors also acted. “Bitcoin has been in accumulation for a long time,” and over the past months, “big players have formed their long positions,” said Andrey Podolyan, head of the Cryptorg trading platform. Strong “momentum candles” that have been observed in recent days are associated with the liquidation of positions of short traders, the expert added. At the same time, adds the founder of MarsDAO Vladislav Utushkin, the rest of the altcoins did not show an update of the maximum values, blocking “their last fall by about 50% only.” In his opinion, this indicates that now the “leading market force” is again Bitcoin.

The deterrent for the cryptocurrency market remains the investigation of the American financial authorities with stablecoins.

In particular, the US Securities and Exchange Commission (SEC) considers Binance USD (BUSD, the third largest stablecoin in the world after USDT and USDC, which together account for 2/3 of the entire stablecoin market) to be an unregistered security.

Paxos (the issuer of BUSD) reported on Feb. 13 that the New York City Department of Financial Services has ordered a halt to issuance of new tokens. According to Bloomberg, this situation even suspended the work of the PayPal payment service on its own stablecoins. From the outcome of these proceedings, according to Mr. Nekrasov, the further movement of the bitcoin rate will largely depend.

In the near future, market participants are positive and expect the rate to rise to $26-27 thousand and even $30 thousand. As Vladislav Utushkin explains, the bitcoin rate has now reached an important level. “There are a very large number of investors who want to buy bitcoin, and they do not let the price go lower,” he notes.

At the same time, the head of InDeFi SmartBank, Sergey Mendeleev, does not believe in the long-term growth of the leading cryptocurrency. “The situation in the global economy continues to be extremely tense, the US market has not yet fully responded to the sharp increase in interest rates, which will inevitably have to be raised anyway. And so far no one has been able to grow with such indicators,” he notes. According to the expert, with such a monetary policy, a global correction is inevitable.

Ksenia Kulikova