Bitcoin prices have been rising in recent weeks and the digital asset has been able to bounce back to November 2022 levels. This was a much-needed boost for the market during this time, but an unexpected investor group is reportedly driving the price of the cryptocurrency.
Bitcoin spikes occur during US hours
Into a new one Matrixport report shared with NewsBTC via email, U.S. institutional investors are boosting bitcoin’s recent price hike. The report notes that the digital asset is already up more than 40% over the course of January, but more than 35% of those increases have occurred during US trading hours. As such, the research report concludes that US investors set the price.
Matrixport explains the reasoning behind this by saying that when an asset performs so well during US hours, especially an asset that trades for 24 hours, it shows that institutional investors are buying the asset. However, if it does well during Asian hours, that means Asian retail investors are buying it.
BTC moves the most during U.S. trading hours | Source: Matrixport
The major movements have occurred during this time and the trend lines bear a very strong resemblance to Bitcoin’s movements to date. But even more interesting is the fact that the data shows that US-based investors are responsible for 85% of the total BTC purchases currently taking place.
What drives these US-based investors?
As the Matrixport report notes, US-based investors have been encouraged by the slowdown in inflation. It has put individual and institutional investors in positions where they believe they can take more risk. Therefore, there is a marked increase in their exposure to risk assets such as bitcoin.
BTC price rises over 40% in less than 30 days | Source: BTCUSD on TradingView.com
In addition, the report points to the possibility of more rallies given that inflation is expected to continue to fall. “This could push the crypto market into a mid-month rally every month and turn into a trend where we see a strong rally from the middle of the month with some consolidation towards the end of the month as traders take profits and miners call to sell. .”
This is also good news for altcoins, as Matrixport notes that historically, money flowing into bitcoin will eventually spread to other digital assets. So this could mean that the market has not seen the last part of the altcoin rally once these institutional investors start diversifying their investments.
BTC is currently trading at USD 22,959 at the time of writing. The coin is posting small gains of 0.06% over the past 24 hours, but on a seven-day rolling basis, the digital asset is still doing quite well with 9.45% gains.
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