Bitcoin spiked to start the final week of March, reclaiming the $70,000 level.
The price of the flagship cryptocurrency was last higher by about 7% at $70,617.68, according to Coin Metrics. Ether jumped 5% to $3,575.01. Most other cryptocurrencies rode the bitcoin wave, too.
MicroStrategy, which trades as a proxy for the price of bitcoin, surged 17%, while Coinbase advanced 9%. The mining sector got a lift from bitcoin, too, with Marathon Digital and Riot Platforms up 2% and 6%, respectively. CleanSpark rose 16% and Cipher Mining gained 12%.
Bitcoin had been in correction mode for the past week, after it hit an all-time high of $73,797.68 on March 14. Last Wednesday, it slid to as low as about $60,800. Alex Thorn, head of firmwide research at Galaxy Digital, said such declines are “well within the norm of historical bull market short-term corrections.”
The reason for Monday’s big run was unclear, but the cryptocurrency’s price action in March has been characterized by new highs followed by healthy pullbacks. Thorn suggested investors were taking a pause from selling shares of bitcoin exchange-traded funds.
“The record GBTC outflows over the last two weeks, likely caused by Genesis and Gemini bankruptcy liquidations, contributed to weakness in spot prices, but several technical indicators pointed to seller exhaustion,” Thorn said.
Sam Callahan, lead analyst at bitcoin services firm Swan Bitcoin, said it’s likely tied to the messaging coming from the Federal Reserve last week.
“Fed officials made it clear last week that they are considering both rate cuts and reducing the pace of its quantitative tightening program this year,” he said. “Such actions will enhance liquidity conditions, acting as a positive catalyst for asset prices. Bitcoin functions as a barometer of liquidity conditions and responded favorably to the Fed’s messaging that monetary policy will likely ease in the near future.”
Despite its pullbacks, bitcoin is on pace to finish March on a winning note. It has gained 12% for the month and 64% so far for the first quarter.