The Bitcoin (CRYPTO: BTC) price is up 3% since this time yesterday, currently trading for US$42,753 (AU$59,108).
That puts the world’s biggest crypto by market cap up 16% in the past 7 days. Though even with that rally, the Bitcoin price remains down 10% year-to-date and down 38% from its 10 November all-time-highs.
Still, the past week’s rally will come as welcome news to crypto investors.
And it’s not just the Bitcoin price shaking off the steep falls from January.
Ethereum (CRYPTO: ETH) is up 22% over the past 7 days.
And leading altcoin Solana (CRYTPO: SOL) is up 31% in that same time.
Though, Ethereum and Solana are also both still deep in the red for the year and well off their own record highs.
Bitcoin price strength fuels gains amongst altcoins
The wider crypto market looks to be getting a boost as investors’ risk appetite appears to be staging a comeback following January’s retreat.
While high growth shares, like many tech stocks, haven’t broadly come roaring back, the selloff has abated.
And altcoins (which refers to any digital token aside from Bitcoin) look to be reaping some of the biggest benefits.
As CoinDesk notes, “The rise in altcoins relative to bitcoin could reflect a greater appetite for risk among crypto investors.”
According to Alex Kuptsikevich, an analyst at FxPro, “Since late last year, there has been a continuing trend that even bitcoin’s calming is enough for altcoins to return to growth and outperform the first cryptocurrency.”
And with the Bitcoin price marching higher, many altcoins are delivering outsized gains.
Keep an eye on the pace of rate rises
Bitcoin, and most altcoins outside of the stablecoins, have proven to be sensitive to interest rate perceptions.
Indeed, on Friday the Bitcoin price slid into the red for a few hours following the release of unexpectedly strong employment figures out of the United States. Forward looking estimates for US labour markets were also revised upwards.
With unemployment tracking to the downside of expectations, the risk of more rate rises from the world’s top central bank increases.
According to Edward Moya, senior market analyst at Oanda (quoted by CoinDesk), “Bitcoin’s initial knee-jerk reaction to the shockingly strong nonfarm payroll report was weakness.”
Moya added that the Bitcoin price has since “managed to stabilise despite rising inflationary pressures that continue to push global bond yields higher”.
The post Bitcoin price rally fuels outsized gains amongst top altcoins appeared first on The Motley Fool Australia.
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More reading
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- Battle of the crypto assets: Bitcoin versus Bitcoin Cash
- Is Bitcoin a good way to diversify an ASX share portfolio?
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- Is Bitcoin using lots of energy actually a good thing?
The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and recommends Bitcoin and Ethereum. The Motley Fool Australia owns and recommends Bitcoin and Ethereum. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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