Why Is Crypto Market Up Today: Reasons Behind the Rally

Why Is the Crypto Market Up Today? What’s Behind the Sudden Spike?

Bitcoin (BTC) surged to a new all-time high of $76,900 after the Federal Reserve implemented a 25 basis point interest rate cut. This move set the target range between 4.5% and 4.75%, reinforcing a monetary policy shift that historically supports risk-on assets. The rate adjustment marked a significant turning point for both traditional financial markets and the digital asset space.

Record-Breaking Inflows for Bitcoin ETFs

Exchange-traded funds (ETFs) in the U.S. that concentrate on Bitcoin (BTC-USD) experienced their highest daily net inflow, totaling $1.38 billion. This increase was driven by President-elect Donald Trump’s favorable view of the digital asset sector and his promise to implement supportive regulations. BlackRock’s IBIT led the charge with over $1.1 billion in net inflows, marking its largest single-day inflow since its January launch. Cumulatively, inflows into all Bitcoin-focused ETFs exceeded $25 billion for the first time, with none of the twelve ETFs reporting any net outflows.

Ether ETFs See Renewed Interest

Ether (ETH) ETFs saw net inflows of $78 million, fueled by a resurgence of optimism in the decentralized finance (DeFi) sector after Trump's victory. On Thursday, ETH's price surged by more than 10%, as hopes for pro-crypto policies and deregulation from the new administration enhanced investor confidence in the asset.

Block’s Strategic Shift: Pulling Back on TIDAL and TBD

Jack Dorsey's Block has disclosed its intention to reduce its investment in TIDAL, the music streaming service previously owned by Jay-Z, according to a letter to shareholders. The company will also be closing TBD, its Bitcoin-focused project designed to create a decentralized internet called "Web5." This strategic decision enables Block to reallocate resources towards its Bitcoin mining activities and cryptocurrency wallet development.

Implications of Trump’s Second Term for the Crypto Sector

The 2024 U.S. presidential election has brought a significant shift in the outlook for cryptocurrency policies, as Donald Trump prepares for his second term in office. With the Republican Party securing control of the Senate and a potential majority in the House of Representatives, crypto advocates, including Coinbase CEO Brian Armstrong, have expressed optimism about the future regulatory environment for digital assets.

Bitcoin and Ethereum Options Expiry Details

Data from Deribit reveals that around 48,794 Bitcoin options contracts, totaling $3.7 billion, are scheduled to expire on November 8. These contracts exhibit a put-to-call ratio of 0.72, with the maximum pain point set at $69,000. In addition, Ethereum options are nearing their expiration, with 294,380 contracts valued at $854.88 million. These also have a put-to-call ratio of 0.65, and the maximum pain point stands at $2,500.