Bitcoin’s (BTC) price is trending solidly back above the 5-digit figure mark. At around 09:00 UTC on Feb. 11, the price of BTC rose back to $10,461 from around $10,200 within an hour.
The peak figure represents BTC’s highest point in over five months and offers a shift in trend from bearish-to-bullish in the mid-term as it continues to print new highs in 2020.
The recent rise in BTC’s price comes amid Federal Reserve Chairman Jerome Powell’s testimony to the U.S. House Financial Services Committee on Tuesday in which he discussed the need for privacy among digital currencies when eyeing through the lens of China's digital yuan.
"A ledger where you know everybody's payments is not something that would be particularly attractive in the context of the U.S.," Powell told the committee.
While Powell’s comments are “somewhat bullish,” the concern is that the U.S. government will insist on creating “back-doors” on all major technology innovations.
Besides Powell’s recent comments, the sudden surge in value may be attributed to three catalysts including increased institutional and retail demand for cryptocurrencies, BTC’s halving event and macro developments, with a focus on the uncertainty surrounding the coronavirus outbreak, analysts and traders were saying.
Joshua Green, a cryptocurrency derivatives trader operating in Australia, told CoinDesk that a combination of “bullish sentiment” around BTC’s halving event, altcoin sentiment “dragging everything higher” and coronavirus concerns supporting the macro perspective are key factors.
“A lot of buying seems to be physical in nature which is good,” Green said.
BTC’s halving event, an occurrence every four years where the bitcoin network undergoes a 50 percent reduction in its mining rewards, has been spurring bullish sentiment reflected in both the spot and derivatives markets.
Data from Skew analytics demonstrates how institutional buying pressure continues to provide a solid base of support for the world’s largest crypto by market cap, reflected in a legitimate increase in derivatives volume and open interest.Analysts like to keep track of changes in open interest to determine the strength of certain price moves. An uptick in price along with a rise in open interest is telling of the strength behind the move to higher prices. A trend is said to be lacking substance when the two metrics move in opposite directions.
In addition, spot volume on major exchanges like Binance are up 13 percent over the last 24-hour, data at Nomics shows.