Bitcoin has won nearly 10% in the past few days as geopolitical tensions eased in the Middle East.
According to Coinbase data, the world's largest cryptocurrency surpassed the $108,200 level today, recovering 9.9% from the low of around $98,400 seen on Sunday, June 22nd.
Analysts highlight several factors supporting the rally, most importantly, easing concerns about the Middle East conflict. “The Bitcoin recovery today reflects the easing of geopolitical tensions in the Middle East,” said Thomas Perfumo, global economist at Kraken. Perfumo noted that Bitcoin as a macroeconomic asset already priced the price of changes in market risk perception.
Furthermore, the ongoing profits of institutional investors are one of the factors supporting the rise. As companies like MicroStrategy continue to buy Bitcoin, Perfumo said newly established funds will also bolster the cycle. He said that if sales pressure in the market drops, continuous inflows into spot Bitcoin ETFs will also generate strong momentum.
Brett Sifling, portfolio manager at Gerber Kawasaki Wealth & Investment Management, attributed the increase in Bitcoin this week to three main reasons. First, a temporary ceasefire between Israel and Iran has encouraged investors to return to dangerous assets. Second, the Fed's signal on possible interest rate reductions and adopting a crypto-friendly approach has boosted the market. Third, he said the positive inflow into Bitcoin ETFs for 10 consecutive weeks indicates that institutional demand is still strong.
Dom Kwok, co-founder and COO of education platform Easea, said President Trump's signal to a ceasefire between Israel and Iran has brought relief to the market. He said that weekend tensions temporarily dropped Bitcoin to under $100,000, but investors' confidence has been restored as the energy market stabilizes.
Kwok noted that such a rapid decline is often a minor “chart break” for long-term investors. “Volatility is the headline, but it's important not to forget the big picture that drives profits,” he concluded.
*This is not investment advice.
