Big Week Ahead? Bitcoin Rallies Towards ATH, Ether Sets A New High, Crypto Marks Hits $3 Trillion
The risk-on sentiments have the crypto market surging with Bitcoin above $66k and Ether near $4,750 while USD net long positioning declining for four weeks straight to their lowest level since late September.
Ahead of what people are expecting to be a big week, the price of Bitcoin (BTC) rallied towards its all-time high. The $1.24 trillion market cap asset started the week on a bullish note by surging past $66,450 on Monday and, as of writing, is hovering above $66k.
Ethereum (ETH) meanwhile hit a new all-time high at $4,770, up more than 10% since the early Sunday low.
As a result, the total crypto market cap has now surpassed $3 trillion.
— Zhu Su 🔺 (@zhusu) November 8, 2021
According to Kyle Rodda, an analyst at broker IG Markets, falling real yields make cryptocurrencies and gold attractive, which do not pay a coupon. But while BTC is up 51% in Q4 and 128% YTD, and Ether, even more, the yellow metal has posted less than 5% returns this quarter and is down 4.26% so far in 2021.
“Financial institutions want to be a part of it, regulators don't want to clamp down on it too much,” he said. “We're almost past the inflection point, where it's part of the system and its going to be very, very hard to extricate it.”
The risk-on effect seen in the stock market is also spilling over to the crypto market. Amidst this, speculators’ net long bets on the USD at $19.51 billion for the week ended Nov. 2nd fell to their lowest level since late September. USD net long positioning has been declining for four weeks straight.
While investors trimmed their bullish bets on the US dollar ahead of the Federal Reserve’ policy decision early last week as per which tapering is coming late this month while interest rates are not getting increased yet, the dollar’s net long positioning remained fairly substantial reflecting “solid bullish sentiment in the greenback as markets look to the beginning of the Fed’s hiking cycle,” said Shaun Osborne, chief FX strategist at Scotiabank in Toronto.
Unlike the USD, the euro saw a sharp reduction in net shorts as European Central President Christine Lagarde pushed back against market bets of an interest rate hike as soon as next year.
Schools Should Teach Crypto
The latest crypto pump comes as Australia's biggest bank, Commonwealth Bank, said it will start offering crypto trading to retail customers in recent weeks.
Additionally, last week, New York Mayor-elect Eric Adams said he would take his first three paychecks in BTC after the Miami mayor made a similar pledge of taking his first paycheck “100% in Bitcoin.”
As he vows to build a crypto-friendly city when he takes office in January, Adams also said that schools should teach about cryptocurrency and its technology.
“When I talked about blockchain and Bitcoins, young people on street stopped and asked me, ‘What is that?’” Adams said on CNN’s “State of the Union” on Sunday.
Bitcoin means a “new way of paying for goods and services throughout the entire globe,” he explained.
“And that’s what we must do – open our schools to teach the technology and teach this new way of thinking.”
When asked if he would encourage businesses in New York City to accept Bitcoin and other cryptocurrencies, Adams said,
“We are going to look at it, and we are going to tread carefully. We are going to get it right.”