Bitcoin has experienced a significant surge, reaching $66,000 in the last 24 hours, breaking free from a period of stagnation as the overall crypto market shows signs of recovery.
October has historically been a favorable month for investors, with potential gains of up to 60% and an average return of 22%. Despite this, the market has been relatively stable in recent weeks, leading to a more cautious approach from investors.
The recent upward movement has reignited optimism surrounding the “Uptober” narrative, with market analysts pointing out reasons why the leading cryptocurrency’s rally could continue.
Based on data from CryptoSlate, Bitcoin’s price has slightly dipped to $65,632 at the time of writing.
US elections
One of the key factors driving this newfound momentum is the increasing belief that both prominent US presidential candidates—Vice President Kamala Harris and former President Donald Trump—have positive views on crypto. This perception suggests that the crypto market could thrive regardless of the election outcome.
Vice President Harris recently unveiled plans to establish a regulatory framework for digital assets, with a focus on protecting retail investors and promoting economic inclusivity, particularly in marginalized communities.
Conversely, Trump has shown strong support for Bitcoin and cryptocurrencies, making pro-crypto statements throughout his campaign.
According to the blockchain-based prediction platform Polymarket, Trump has a 56.2% chance of winning the upcoming election, while Harris stands at 43.4%.
Despite the uncertainty surrounding the election, major institutions like Galaxy Digital believe that Bitcoin will remain resilient regardless of the election outcome.
BlackRock CEO Larry Fink echoed this sentiment, stating that Bitcoin is poised for growth irrespective of the election result. He emphasized that Bitcoin’s upward trajectory is driven more by liquidity and transparency than by regulatory changes or political leadership.
Other driving factors
Additional potential drivers behind Bitcoin’s recent performance include shifting market sentiment and global economic conditions.
In a note dated October 15 from trading firm QCP Capital, it was suggested that disappointment with China’s recent economic stimulus efforts may have prompted some investors to shift funds from Chinese equities to Bitcoin.
China’s attempts to stimulate its economy have fallen short, leading to doubts about the effectiveness of their measures to combat deflation. This uncertainty has brought further attention to Bitcoin as an alternative investment.
Furthermore, the extension of repayments to Mt. Gox exchange creditors by another year has alleviated concerns about a sudden influx of Bitcoin supply flooding the market.
Geopolitical risks also seem to be diminishing, with reports indicating that Israel may postpone targeting Iran’s crude oil and nuclear infrastructure. This reduction in tensions could contribute to greater stability in global markets.
QCP Capital also pointed out that the current absence of significant inflation or labor data could allow the crypto market to rise with reduced risk premiums.
