YEREVAN (CoinChapter.com) — Why is crypto market rising today? On Nov 15, the crypto market surged, adding $110 billion to its market cap and reaching a valuation of $1.4 trillion despite a slight correction on Nov 16. This move accentuates the ongoing bullish monthly trend.
Why is Crypto Market Rising Today?
Let’s dive into why the crypto market is rising today.
Bitcoin Institutional Adoption
The first and foremost reason why the crypto market is rising today is Bitcoin (BTC). The cryptocurrency accounts for 52% of the overall crypto market valuation. Thus, its performance plays a key role in determining the broader market sentiment.
Bitcoin outperformed traditional assets like US equity indexes and gold today. According to Charlie Morris, founder of investment advisory firm ByteTree, “Bitcoin is going mainstream, and the bear is behind us. The good times are here.”
“Bitcoin’s robust performance, outshining major assets, signals a key milestone for institutional adoption, as Morris points out. Institutions are increasingly drawn to alternatives like Bitcoin for their superior returns.
For instance, CoinShares data shows Bitcoin-specific funds receiving over $1 billion worth of investments in 2023.
Crypto Long Liquidations
The recent Bitcoin price fluctuations caused a cascade of liquidations, which peaked on Nov 15.
According to the on-chain tracker Glassnode leveraged crypto long positions worth over $307 million were liquidated in 24 hours, the largest single-day liquidation of long positions since Aug. 17, indicating a notable shift in the market. Bitcoin liquidations account for $133 million of the noted positions.
In this particular instance, over 88,667 traders were affected by the liquidations, indicating the broad impact on the market. While these large-scale liquidations can have a profound impact on market dynamics, the crypto bulls
High Hopes for a Bitcoin Spot ETF Approval
The growing anticipation of a Bitcoin spot exchange-traded fund (ETF) approval by the U.S. Securities and Exchange Commission (SEC) also buoyed the crypto market. Some analysts were more optimistic than others, explaining why the crypto market is rising today.
For example, Eric Balchunas and James Seyffart of Bloomberg suggest a 90% chance that at least one spot Bitcoin ETF will be greenlit by Jan. 10, 2024.
The potential approval has opened an eight-day window, starting Nov. 9, for decisions on twelve Spot Bitcoin ETF filings. Crypto traders place high hopes on the potential approval, as it could supposedly pave the way for broader institutional adoption of Bitcoin, offering a regulated, stock market-like way to invest in cryptocurrency.
US Economy and Consumer Spending Growth
Another reason why the crypto market is rising today is the overall economic growth in the US.
According to Reuters, the US economy has grown at a rate of almost 5% in Q3 2023. This surge, fueled by higher wages and increased consumer spending, is the fastest in nearly two years.
The robust performance put additional cash in investor pockets, which could have propelled the risk-on markets like cryptocurrencies.
In conclusion, the current surge in the crypto market can be attributed to a combination of factors. The high hopes for a Bitcoin ETF approval, the robust growth of the US economy and consumer spending, and the impressive performance of Bitcoin against traditional assets created a favorable environment for the rise in the crypto market.