①Bitcoin and other cryptocurrencies rebounded sharply on Wednesday evening, with Bitcoin's price rising more than 6% during the day, briefly surpassing $74,000; ②One reason for the improvement in market sentiment is that investors seem to have reduced their concerns about the U.S.-Israel-Iran conflict, coupled with Trump's public support for U.S. cryptocurrency legislation; ③Analysts believe that the Bitcoin market may be poised for a reversal, and the worst period has passed.
$Bitcoin (BTC.CC)$ Bitcoin and other cryptocurrencies experienced a rapid rebound on Wednesday evening, aligning closely with the trend in U.S. equities. This may indicate a partial easing of market concerns over geopolitical conflicts.
On Wednesday, Bitcoin's price surged more than 6% intraday, briefly breaking above $74,000. However, it has since retreated below $73,000. Other major tokens also posted gains. $Ethereum (ETH.CC)$ The increase exceeded 8% over the past 24 hours.
There are many reasons for the improvement in market sentiment, one of which is that market participants seem to have reduced their concerns about the U.S.-Israel-Iran conflict. However, wars and other economic policies are still changing rapidly, affecting the trends of all risk assets. As the leading cryptocurrency, Bitcoin's price has been deeply influenced by the macro environment and plummeted earlier this week due to risks in the Middle East.
On the other hand, the strong inflow of funds into spot Bitcoin ETFs at the beginning of this year indicates that the adoption of Bitcoin by institutional investors is far from waning.
More notably, Trump publicly supported the U.S. cryptocurrency legislation, the '2025 Digital Asset Market Clarity Act' (CLARITY Act). Cryptocurrency experts stated that the passage of this bill is the only catalyst likely to pull the cryptocurrency market out of months of downturn.
Stabilized?
The CLARITY Act aims to establish a common framework for assessing whether cryptocurrencies are securities or commodities, but it has been stalled in the Senate due to a deadlock between the cryptocurrency industry and large banks over stablecoin rewards. However, Trump’s statement on Truth Social on Tuesday evening seems to have reignited optimism about the eventual passage of the bill.
Trump stated that the banking industry should not attempt to weaken the GENIUS Act or hold the CLARITY Act hostage; they need to reach an agreement with the cryptocurrency industry because that is in the best interest of the American people.
Additionally, Mike Selig, Chairman of the U.S. Commodity Futures Trading Commission appointed by Trump, publicly supported perpetual Bitcoin futures, further boosting the confidence of crypto investors.
Selig stated that the Biden administration has driven cryptocurrency companies and related investments overseas, including the perpetual futures market. The current administration must bring Bitcoin perpetual futures back to the United States, and the government is working hard to achieve this goal as soon as possible.
Rachael Lucas, a cryptocurrency analyst at BTC Markets, stated that Bitcoin's breakout above $74,000 could be a signal that the market is beginning to stabilize after ongoing selling pressure. On Monday and Tuesday, inflows into U.S. spot Bitcoin ETFs approached $700 million, marking a sharp reversal after four months of continuous outflows.
K33 researchers also noted in a report that the worst period has passed. The market now only needs to wait, as Bitcoin’s bottoming phase has historically unfolded gradually.
Editor/Doris
