The market capitalization of the largest cryptocurrency was $25,000, but the price quickly fell back. Bitcoin crossed the $25,000 mark late Saturday night, marking the first time it had done so since June 13.
It had lost steam by Sunday morning and was back at $24,510 on CoinMarketCap as of Monday morning. This is a sign that $25,000 will likely remain a key resistance level in the largest cryptocurrency.
Bitcoin has only risen 5.85% over the past week. No. 2 Ethereum is up 16% over the past week due to anticipation of the upcoming merger to a Proof-of-Stake model.
Bitcoin’s rise may be due to cooling inflation. The key economic indicator remained the same last month, as rising prices were countered by Federal Reserve interest rate hikes.
Bitcoin and the rest the crypto market, along with other assets such as stocks and bonds, have been hard hit all summer by rising inflation.
In turn, the Fed has increased interest rates. This has created a risky environment in which investors have sold crypto and volatile tech stocks in order to keep their greenbacks.
Bitcoin was previously thought to be an inflation hedge. However, its status as an anti-inflationary digital gold has been proven this year. It has closely correlated with tech stocks.
Despite recent signs of recovery, Bitcoin is still 64% below its November 2021 record of $69,044.77.