Bitcoin climbed to a nine-month high on Monday as turmoil in the banking sector prompted investors to turn to digital assets.
The largest cryptocurrency rose to $28,567, its highest value since mid-June 2022. In the last 24 hours, it has produced an increase of almost 4%, while amid growing expectations, central banks will slow down the pace of interest rate increases.
Bitcoin is up 26% in the past week, its best weekly gain since April 2019. It has jumped nearly 40% in the past 10 days as turmoil in the banking sector has spread around the world, culminating so far this weekend with UBS Group's purchase of rival Credit Suisse Group AG.
Traditional assets such as bank stocks and bonds fell on Monday after UBS sealed its takeover of state-backed Credit Suisse, a deal it had to pull to restore confidence in the battered sector.
Leading central banks around the world faced the risk of a rapid loss of confidence in the stability of the financial system on Sunday. Such a global response has not been seen since the peak of the COVID-19 pandemic.
"This impressive rise is the result of the banking crisis"
said Tony Sycamore, an analyst at IG Markets
He predicts that a move towards $32,000 will require Bitcoin to stay above the key support level around $25,000 .
Other market participants have also predicted that Bitcoin will benefit from central bank efforts to bolster liquidity in the global financial system.
In November 202, BTC hit a record high of $69,000 after central banks and governments introduced unprecedented monetary and treasury stimulus measures.
"Momentum is always driven by liquidity"
said Markus Thielson of Singapore-based digital device company Matrixport.
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