Highest level in two weeks
Bargain hunters pull bitcoin higher
02/05/2022, 4:09 p.m
Good news for crypto fans: The Bitcoin course is again well above 40,000 dollars. Investors are now dealing with cryptoassets in a similar way to tech stocks: if the Nasdaq rises, crypto assets rise. Amazon saved the badly battered tech industry on Friday.
After the recent gains on the US technology exchange Nasdaq, the digital currency Bitcoin continued to soar on Saturday.
The listing hit its highest level in more than two weeks, as high as $41,983.12, extending Friday’s gains. That was up 16 percent from Thursday and 27 percent above this year’s low of $32,950.72 on Jan. 24. The second most important digital currency, ether, which is connected to the Ethereum blockchain network, climbed above $3,000 for the first time since Jan. 21 on Saturday. “Bargain hunters continue to try their luck,” said analyst Timo Emden of Emden Research.
These synchronized movements between Bitcoin and Nasdaq show once again that Bitcoin has entered the mainstream. According to Ed Hindi, Chief Investment Officer of Swiss crypto investment fund Tyr Capital, investors are now treating cryptoassets in a similar way to tech stocks. When Nasdaq valuations fall, they also liquidate their crypto assets – and buy them up when positive signals return.
“The current panic and volatility surrounding Bitcoin is based on a fundamental misunderstanding of Bitcoin as an asset class,” Ed Hindi told Reuters. “As Nasdaq valuations fall, misguided institutional investors begin liquidating Bitcoin positions en masse as if it were a tech stock.”
Last week, Amazon and Snapchat saved the image of the badly battered tech industry after recent significant losses. After the shock of the figures from Facebook’s parent company Meta on Thursday, the Nasdaq closed up 1.6 percent on Friday. Amazon had successfully calmed the nerves of investors with its balance sheet.
However, two risk factors for the markets remain: US monetary policy and the saber-rattling between Ukraine and Russia. The recovery for Bitcoin could “only continue if the $40,000 mark is sustained,” says analyst Timo Emden from Emden Research.