Bitcoin has once again reached the $106K level after briefly dropping below $98.5K. This recovery followed the U.S. President's announcement of a ceasefire between Israel and Iran, serving as a positive signal for investors.
Bitcoin Market Responds to News
Following Donald Trump's announcement of a 'total ceasefire' between Israel and Iran, global markets calmed down. Bitcoin reacted with a sharp recovery, although $193 million in long position liquidations occurred, amounting to about 0.3% of total open interest. However, the value of leveraged positions remained steady at around $68 billion, indicating that most traders preferred to hold their positions.
Bitcoin Mining Activity Under Strain
Bitcoin's hashrate dropped 8% from Sunday to Thursday, falling from 943.6 million terahashes per second (TH/s) to 865.1 million TH/s. Some experts speculate that mining disruptions in Iran or neighboring regions might have contributed to this decline. However, such assumptions remain speculative due to the lack of verifiable data. Daniel Batten warned against drawing excessive conclusions from short-term hashrate fluctuations, highlighting their link to temporary power supply issues.
Rising Expectations of Interest Rate Cuts
In addition to Bitcoin's recovery, oil prices sharply fell after peaking at $77 on Sunday. This, combined with a 1% rise in the S&P 500, boosted expectations of a U.S. Federal Reserve interest rate cut. According to CME's FedWatch tool, the probability of rates remaining at 4.25% through November dropped to 8.4%, while the odds of a cut to 3.75% or lower rose to 53%.
Despite instability in the world and markets, Bitcoin's recovery above $100K indicates that institutional demand remains strong.
