Bitcoin briefly jumps above $23,000 as the cryptocurrency recovers from a rocky 2022

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After seeing its value plummet 65% last year, Bitcoin has reversed it so far in 2023, briefly jumping above the $23,000 mark over the weekend for the first time since August. last.

The world’s most popular cryptocurrency traded steadily below $20,000 for most of January, a clear departure from how it started 2022 at around $47,000, but the rally in the weekend gives investors hope that the coin has bottomed out. Year-to-date, the crypto token is up around 39%.

The digital currency pared its gains slightly on Monday morning ET, trading around $22,855 according to CoinMarketCap.

Bitcoin’s weekend rally comes as some economists take a more optimistic view of the economy after months of pessimistic forecasts. In a Jan. 13 tweet, former Treasury Secretary Larry Summers said the Fed’s job looks much, much closer to being done, after the central bank raised interest rates several times in 2022 with the aim of curbing inflation. His efforts appear to have paid off so far, although other experts still believe inflation may be difficult to bring back to the Fed’s 2% target.

I will stick to my view that a recession this year is more likely than not. But certainly looking at some of these trends, one must think that the Fed’s job seems much, much closer to being done. We will monitor the data closely. @BloombergTV https://t.co/bu0kKEbSrA

Lawrence H. Summers (@LHSummers) January 14, 2023

Adding a key to Bitcoin’s ability to sustain its recent rally are the ripple effects of the collapse of crypto exchanges FTX. The exchange collapsed in November and now owes around 1 million creditors a cumulative amount of $3.1 billion.

Still, some investors seem to be very optimistic, despite some of the industry’s setbacks. After losing over $2 trillion in value and falling from the ranks of the trillion-dollar asset classes, crypto has regained that status in recent weeks.

Bitcoin also saw inflows of $5.7 million last week, according to data from digital asset trading and investment group CoinShares. Digital asset investment products saw inflows totaling $37 million last week, though the majority of that money went into products that help investors short or bet against the price of assets. cryptocurrencies.

The second most popular crypto, Ethereum, saw inflows of $4.2 million and saw inflows of $6.8 billion year-to-date, according to CoinShares. The crypto hit $1,674 on Saturday, according to CoinMarketCap, the first time it has topped the $1,600 mark since last November.

The cryptocurrency was still trading above this level on Monday morning at $1,617.

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