The market value of cryptocurrencies reclaimed the $1 trillion threshold on Monday for the first time since June 13.
Monday’s more than 5% rally in both bitcoin and ether helped drive broad gains across the crypto sector.
The gains come amid a devastating bear market that erased more than $2 trillion in value and led to several bankruptcies.
Monday’s gains should be a welcome sign to crypto investors, as they have had to deal with a devastating bear market over the past nine months. The ongoing bear market in crypto has erased $2 trillion in market value and led to several bankruptcies among crypto firms like Celsius, Voyager Digital, and Three Arrows Capital, among others.
Those bankruptcies, combined with the more than 70% price crashes in popular crypto tokens, have led to declining confidence in the sector among investors. But that could slowly turn around if bitcoin and ether show signs of reversals.
Bitcoin jumped more than 5% to cross above $22,000 on Monday, representing its highest level since early June and giving credence to the idea that $20,000 may hold as an important support level for the crypto token. That same level acted as area of significant resistance during bitcoin’s late 2017 bull market rally, and in technical analysis, old resistance tends to become new support (and vice versa).
Meanwhile, ether surged 12% to about $1,500 amid growing anticipation about an upcoming network update following comments from an Ethereum Foundation member last week. The cryptocurrency is up more than 50% from its lows over the past month.
Investor sentiment often follows prices, so if the rally in bitcoin and ether can hold, it could lure more investors back into the space and create buying pressure that helps drive a broad recovery in the space.
Confidence is also building up as crypto billionaire Sam Bankman-Fried lends money to various crypto firms that have seen funding run dry, including BlockFi, a crypto lender that had too much exposure to failing crypto projects amid the sell-off.
Bitcoin and ether’s gains slowly spread to other cryptocurrencies on Monday, with most coins that had at least a $1 billion market value moving higher than lower, according to data from CoinMarketCap.
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