đđWhy Bitcoin and Gold Rise: Analysts Share All the Reasons! đđ
Bitcoin and gold have recently surged due to increased global liquidity, central bank balance sheet expansion, and the FED's recent interest rate cuts. Bitcoin has increased by 7% in the last five days, exceeding $64,000 for the first time since August, while gold has reached a new peak this year, rising to $2,600 per ounce.
He emphasized that both Bitcoin and gold have been among the best-performing assets of the year since Bitcoin's inception in 2009. Analyst James Van Straten attributes this successful performance to various factors, such as the expansion of global central bank balance sheets and the FED's 50 basis point cut in interest rates to support economic activity. The FED's balance sheet currently stands at $7.1 trillion; quantitative tightening continues, but its pace has slowed. In addition, the decrease in the reverse repo balance, which was slightly over $300 billion, provided liquidity to the financial system, stimulating lending, investment, and overall economic growth.
The total balance sheet of the 15 largest central banks worldwide, including countries such as the United States, the European Union, Japan, and China, has reached approximately $31 trillion. This increase, which has continued since July, has created a particularly positive environment for cryptocurrencies sensitive to liquidity trends, such as Bitcoin.
The Fedâs rate cut has further strengthened both Bitcoin and gold, as low interest rates encourage a shift towards riskier and alternative assets. According to analysts, increased liquidity and stimulus measures are helping both assets reach new heights, reinforcing their roles as the best performing assets in the current economic conditions.
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