BTC price is on a tear, up 175% year to date, with the potential for more gains. It comes barely 24 hours after Coinbase CEO Brian Armstrong said, “One idea I’ve been contemplating is that BTC may be the key to extending Western civilization.”
According to the Coinbase executive, while the US is on a journey to inflating the money supply and increase deficit spending, the people now have an alternative, crypto, posing as an antidote to inflation.
The latest rally has taken the total crypto market cap to the $1.54 trillion.
Leaders say the growing confidence in the crypto market has been fuelled by expectations of the US Federal Reserve cutting interest rates in 2024 and the eventual approval of a Bitcoin ETF, which could drive up the price of the world’s largest cryptocurrency.
Several factors look to be aiding bitcoin growth. There’s optimism around a possible spot exchange-traded fund (ETF) approval in the U.S., traders pricing in expected rate cuts in the U.S. – which buoys risky bets such as technology stocks and bitcoin.
Bitcoin had plunged to about half its value from the peak in 2021, following which trading volumes for crypto exchanges in India have plunged more than 90% since February 1, 2022.
Bitcoin plunged after the failure of some prominent crypto exchanges like FTX and the end of an era of ultralow interest rates.
In the Annual Budget of 2022, Finance Minister, Nirmala Sitharaman imposed a 30% tax on crypto gains and a 1% tax deducted at source (TDS) on all sell transactions.