(Bloomberg) — Bitcoin is fast approaching $100,000 once again, after reaching its highest level since late February, with investors’ appetite for risk being rekindled across financial markets.
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The original cryptocurrency has faced downward pressure in recent weeks as Donald Trump’s tariff policy prompts a steep rout in both the stock and digital-asset market. It had dropped as much as 30% after reaching a record high of about $109,000 on Jan. 20, the day Trump was inaugurated for a second time as US president.
The largest token by market value climbed as much as 3.1% to $97,483, the highest since Feb. 21. Bitcoin last traded at $100,000 in Feb. 7. Many smaller tokens rallied even more on Thursday, with Dogecoin jumping 4.8% and Ether up 3.3%.
The respite comes amid an uptick in the spot markets with muted demand for derivatives that are typically used for adding leverage, suggesting a shift toward momentum trading from a trend in which Bitcoin prices are largely driven my macroeconomic factors such as inflations and tariffs.
Exchange-traded funds tracking Bitcoin and Ether raked in over $3.2 billion last week, with the iShares Bitcoin Trust ETF (ticker IBIT) alone seeing a nearly $1.5 billion inflow — the most this year, data compiled by Bloomberg show.
Liquidations in both bullish and bearish bets on crypto assets remain subdued while demand for upside exposure in the options market has increased with the call options with the strike price of $100,000 seeing the most open interest across all tenors, according to data compiled by Coinglass and the largest crypto options exchange Deribit.
“Market sentiment has broadly shifted in favor of momentum based trades fueled by spot demand, as BTC breaches levels not seen since early February,” said Chris Newhouse, director of research at Ergonia, a DeFi trading firm. “BTC continues to shift between correlations with gold and equities — highlighting a more nuanced and dynamic relationship with macro factors balanced with short-term momentum and spot demand.”
The crypto market saw a sharp drop early last month as Trump unveiled his tariffs against some of the largest US trading partners. Investors rotated their capital out of digital assets amid the risk-off environment, triggering sizable liquidations in crypto futures contracts.
