Bitcoin Tops $18,000 as FTX Recovers $5B

Bitcoin surged to its highest price in a month, as traders are inspired by FTX asset recovery and possible inflation curb

Bitcoin FTX

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Bitcoin climbed above $18,000 for the first time since Dec. 14 late Wednesday, showing a 5% growth in the last 24 hours. At the point of writing, it is trading at $18,133, adding up another 1% in value.

The surge took place as a few factors shifted market sentiment to the positive side. Firstly, the collapsed FTX crypto giant announced it was recovering cash assets worth more than $5 billion. The company’s lawyer also mentioned the discovery of some liquid investment securities and liquid cryptocurrency.

Furthermore, US inflation data scheduled to release today is forecast to show an inflation slowdown. Economists polled by Dow Jones forecast that CPI declined 0.1% month-on-month in December. In their turn, investors are hopeful the decline may incentivise the Fed to reverse interest rate increases.

Easing the rate hikes would eventually take some pressure off risk assets such as crypto as well as growth stocks, which are the backbone of the US stock indexes.

At the same time, any potential “black swan” event in the crypto industry threatens to disrupt investors’ fragile optimism. Currently, speculations rise about the potential shutdown of another major crypto player – DCG. However, industry experts like Mike Novogratz expect this possible crisis won’t “include a lot of selling.”

Vijay Ayyar, vice president of corporate development and international at crypto exchange Luno, agrees that the worst days for the crypto market are close to the end.

“We’ve had many negative events transpire over the past year, and if one looks at the price reaction to those events, in general it’s been declining less and less — an indication that the market is accepting the news quite well, sell pressure is being absorbed, and hence we’re moving to an accumulation stage.”
Vijay Ayyar