Cryptocurrency markets experienced a notable upswing on Monday, with Bitcoin surging above $27,000 for the first time this month. According to Coin Metrics, Bitcoin was up 3%, reaching $27,307 after briefly touching $27,403.17. Ethereum (Ether) also gained 2%, trading at $1,658.89.
Among other cryptocurrencies, Solana and Cardano saw 5% and 2% increases, respectively, while Binance Coin added 1.5%. XRP, a payments token, recorded a gain of about 1.5%, and DeFi tokens associated with the Polkadot and Polygon networks each increased by about 2%.
The exact reason behind this price surge remains unclear, but it coincided with a spike in trading volume during Asian market hours. Dessislava Aubert, a senior research analyst at crypto data provider Kaiko, noted that in the current low-liquidity environment, relatively minor buying and selling pressure could amplify spot price movements and potentially trigger liquidations in derivatives markets.
This volume spike followed a report by Japan’s Nikkei over the weekend, which suggested that the Japanese government plans to permit startups to sell digital tokens to venture capital funds alongside traditional assets like shares and stock options.
Looking ahead, Aubert expects volatility in cryptocurrency markets this week, especially given several significant central bank meetings on the horizon.
These cryptocurrency price movements also coincide with a rising stock market in anticipation of the Federal Reserve’s two-day policy meeting, scheduled to conclude this Wednesday. Market expectations point to a 99% likelihood that the Fed will maintain current interest rates, with just a 31% probability of a rate hike in November, according to the CME Group’s FedWatch tool.
Despite recent bearish sentiment among investors, Bitcoin has recorded its first back-to-back weekly gains since May. However, some concerns have arisen due to Bitcoin’s 50-day moving average turning lower in August and crossing below its 200-day moving average. While cryptocurrency traders are often accustomed to short-term volatility, this trend has raised concerns about potential shifts in long-term momentum.
As of Monday’s surge, Bitcoin has posted a monthly gain of 4%.
