Bitcoin has made a strong surge to a high of $66,000 in the last 24 hours, breaking out of a period of stagnation as the wider crypto market sees signs of recovery.
October has historically been a favorable month for investors, with gains reaching up to 60% and an average return of 22%. Despite this, the market has been relatively stable in recent weeks, leading to a more cautious stance among investors.
The recent upward movement has reignited optimism around the “Uptober” narrative, with market analysts pointing to reasons why the leading asset’s momentum could continue.
As per CryptoSlate data, Bitcoin’s price has slightly pulled back to $65,632 at the time of writing.
US Elections
One major factor driving this renewed momentum is the growing belief that both prominent US presidential candidates—Vice President Kamala Harris and former President Donald Trump—are supportive of crypto. This perception suggests that the crypto market could benefit regardless of the election outcome.
Vice President Harris recently unveiled plans to establish a regulatory framework for digital assets, with a focus on protecting retail investors and promoting economic inclusion, particularly in minority communities.
Meanwhile, Trump has positioned himself as a strong advocate for Bitcoin and cryptocurrencies, making pro-crypto statements throughout his campaign.
Blockchain-based prediction platform Polymarket indicates Trump with a 56.2% chance of winning the upcoming election, while Harris stands at 43.4%.
Despite election uncertainties, leading institutions like Galaxy Digital believe that Bitcoin will remain resilient regardless of the election results.
BlackRock CEO Larry Fink has also expressed confidence in Bitcoin’s potential to thrive regardless of the election outcome. He emphasized that Bitcoin’s growth is primarily driven by liquidity and transparency rather than regulation or political leadership.
Other Key Drivers
Other potential factors contributing to Bitcoin’s recent performance include changing market sentiment and global economic conditions.
In a note dated October 15, trading firm QCP Capital suggested that disappointment with China’s latest economic stimulus measures may have prompted some investors to shift funds from Chinese equities to Bitcoin.
China’s efforts to stimulate its economy have been underwhelming, leading to doubts about the effectiveness of its policies in combating deflation. This uncertainty has drawn attention to Bitcoin as an alternative asset.
Furthermore, the extension of repayments to Mt. Gox exchange creditors by another year has alleviated concerns about a sudden influx of Bitcoin supply flooding the market.
Geopolitical risks also seem to be decreasing, with reports indicating that Israel may postpone targeting Iran’s crude oil and nuclear infrastructure. This reduction in tensions could bring added stability to global markets.
QCP Capital also highlighted that the current absence of significant inflation or labor data allows the crypto market to rise with lower risk premiums.