After the bloodbath seen in 2022, most cryptocurrencies began to turn the corner at the start of the new year. The general increase in risk appetite has proven to be salubrious for the space.
Bitcoin Joins The Party: Bitcoin BTC/USD, the apex crypto, peaked at $68,789.63 on Nov. 10, 2021, and went downhill for most of 2022, when it lost about 64.27%. The plunge was far steeper than the broader equity market, but it was in line with high-profile tech stocks. The S&P 500 Index lost a more modest 19.44%. In comparison, mega-cap stocks such as Tesla and Meta ended 2022 with a loss of about 65%.
Last year’s plunge in Bitcoin’s price was largely driven by macroeconomics and geopolitics, as well as crypto-industry-specific risks. The fall was swift and hard. After starting 2022 at $46,311.75, it fell over the course of the first half of the year and bottomed at $17,708.62 on June 18. The apex crypto, which has a market capitalization of just under $400 billion currently, then consolidated below the $25,000 level.
The crypto retested the mid-June lows in early November and plummeted to a fresh bottom of $15,599.05 on Nov. 21, 2022. It was bouncing around this bottom until the first week of January 2023.
Since Jan. 8, Bitcoin has begun an uptrend, and it scaled above the $20,000 psychological resistance on Saturday, going past the barrier for the first time since Nov. 8, 2022. Intraday, it rose to a high of $21,075.14.
Incidentally, the new year has brought new hopes to the financial markets due to expectations that the slowing inflation and a soft economic patch would allow the Fed to slow its fed funds rate hikes or even to pause. Bond yields, which rallied hard in 2022, have pulled back notably in the new year, baking on expectations of at least a mild recession.
See also: How To Buy Bitcoin (BTC)
Returns From Bitcoin: A $1,000 invested in Bitcoin at its 2022 trough of $15,599.05 would have fetched 0.064 of a bitcoin. An astute investor, who would have called the bottom right, would now be sitting at a profit of roughly 37% (based on Sunday’s intraday high of $21,075.14) in about three months.
Bitcoin bull and venture capitalist Tim Draper calls for the crypto to hit $250,000 by the end of 2023. This would translate to a mouth-watering return of roughly 1085%. On the other hand, skeptics are still guarded and downbeat. Notwithstanding the recent upward bounce, economist Peter Schiff has urged investors to sell Bitcoin.
The crypto has to break above a near-term resistance of $21,500 to confirm the strength of the recent rally. Further up the chart, it has resistance around the $22,600 level.
At last check, Bitcoin was up 0.15% in the past 24 hours $20,898.58, according to Benzinga Pro data.
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