- Bitcoin hits $38.8K, its highest price since May 2022, amid growing institutional demand and optimism around a spot bitcoin ETF
- MicroStrategy boosts its bitcoin holdings by over 10% in November, now holding 174,530 BTC at an average price of $30,252 per coin
- Bitcoin has outperformed bonds, rising 35% since mid-October while the 10-year Treasury yield dropped 70 basis points to 4.3%
Bitcoin rose to $38,800 on Friday, its highest level this year. The price increase comes amid growing institutional demand and optimism around a spot bitcoin ETF.
The latest price moves in crypto markets in context for Dec. 1, 2023. Bitcoin hit $38,800 on Friday morning, its highest level since May 2022. The top cryptocurrency by market capitalization is up around 2% on the day.
Global stock markets also witnessed gains, with futures of U.S. indexes S&P 500 and Dow Jones adding 0.17% and Europe’s Stoxx 600 advancing 0.52%.
Driving Factors
Institutional Demand
The price jumps come as euphoria around a planned spot Bitcoin exchange-traded fund (ETF) in the U.S. heats up.
On-chain data also suggests a significant amount of bitcoin has moved to cold storage, indicating rising institutional demand. This points to a lack of imminent sell pressure.
MicroStrategy Purchases
Microstrategy, the largest corporate holder of Bitcoin, boosted its holdings in November by 16,130 BTC worth around $608 million.
The company now holds 174,530 BTC bought at an average price of about $30,249 per coin. MicroStrategy has increased its holdings by over 10% in a month.
Global Developments
Brazil Taxes
The Brazilian Senate approved income tax rules that could require citizens to pay up to 15% tax on crypto earnings from foreign exchanges.
The regulation could take effect on Jan. 1 if approved by President Lula da Silva. It would apply to Brazilians earning over $1,200 annually from foreign crypto exchanges.
Market Analysis
Bitcoin Outperforms Bonds
Bitcoin’s price has risen 35% since mid-October while the 10-year U.S. Treasury yield has dropped about 70 basis points to 4.3%.
The decline in the risk-free rate likely paved the way for investors to welcome the planned launch of a spot bitcoin ETF in early 2023.
Looking Bullish So Far
Bitcoin hit its highest level in seven months as growing institutional demand and optimism around an ETF outweigh macroeconomic concerns. The cryptocurrency remains on a strong upward trajectory to finish 2022.
