Crypto Market Gains 4% in 24 Hours as Bitcoin Holds Firm Above $100K

Crypto Reporter

Shalini Nagarajan

Crypto Reporter

Shalini Nagarajan

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Shalini is a crypto reporter who provides in-depth reports on daily developments and regulatory shifts in the cryptocurrency sector.

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Last updated: 

December 12, 2024

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The global crypto market surged by 4% on Thursday, with altcoins rallying and spot crypto ETFs attracting significant investments, as Bitcoin rebounded to the $100k mark.

This uptick followed a tough Wednesday, where leveraged traders incurred losses amounting to $1.5b due to a bearish beginning of the week.

Crypto Market Gains Momentum Amid Hopes for Lower Interest Rates

The market’s surge followed positive US CPI data that signaled expectations for a less aggressive monetary policy, boosting the appeal of risk-on assets like cryptocurrencies. Wednesday’s data showed that the CPI rose by 0.3% last month, the highest increase since April, following four months of 0.2% gains.

This fueled speculation that the Federal Reserve might cut interest rates by 25 basis points at its next meeting, lifting stock futures and sparking a modest Treasury rally.

Lower interest rates cut borrowing costs, boost market liquidity, and encourage investors to move funds into higher-risk assets like cryptocurrencies. As a result, investors may shift funds from safe-haven assets like bonds to the volatile cryptocurrency market, seeking higher returns.

Crypto Market Turns Around as Bitcoin Finds Support, Analysts Predict Growth

Aave, Sui and Chainlink led the gains among cryptocurrencies. Meanwhile, Bitcoin and Ether increased by 3.5% and 6.8%, respectively.

It marks a turnaround for the market as Bitcoin is recovering after dropping below $96,000 earlier this week due to investors cashing in profits at peak prices, which increased selling pressure and drove prices down.

Buyers regained control when Bitcoin’s price fell below $95K, leading to a recovery, said Alex Kuptsikevich, FxPro’s chief market analyst.

“The meaningful round level has prompted long-term private holders to sell. At the same time, there is a growing appetite for corporations to buy on their balance sheets. Then, there is the key to how governments holding impressive amounts of confiscated Bitcoins will behave,” he said.

Kuptsikevich further noted that Bitcoin is currently facing psychological resistance, reminiscent of 2020, when it was reluctant to surpass $20K at year-end but ultimately broke through, shortly doubling in price thereafter.

“In this cycle, we see upside potential to $120-140K in the next couple of months before the next major shakeout,” the analyst said.

Altcoins Show Rally Potential

According to Avinash Shekhar, co-founder and CEO at Pi42, Bitcoin’s rebound points to bullish trends in the market.

“Optimism is that BTC might target $112,000 and could go up another level to hit $125,000. Resistance at $104,088 could keep volatility in check in the shorter term as market can see consolidations,” Shekhar said.

“Ethereum and XRP will also look at further upward moves, as ETH targets $4,500 if a key breakout is above $4,000 and XRP on rebound support at above $2.30 puts the aim at $3.50. Meanwhile, Dogecoin climbing from oversold territory shows renewed demand and improves optimism in the market. This could indicate a wider rally among altcoins and keep the bullish sentiment alive in the crypto market as investors wait for clearer signs of the macroeconomic stability.”