The crypto market has returned to a capitalization of over $3 trillion after a recent downturn prompted by actions from Donald Trump. Bitcoin's price rose above $95,000 following the announcement of a crypto strategic reserve.
Factors Affecting the Market
The recent downturn and subsequent recovery of the crypto market were influenced by Donald Trump’s actions related to U.S. economic policy. The imposition of tariffs led to a drop in crypto asset prices, whereas the announcement of a strategic crypto reserve saw Bitcoin's value surge above $95,000.
Crypto Reserve and Global Implications
The establishment of a crypto reserve, including Bitcoin, Cardano, XRP, and Solana, may trigger global interest in these assets. As Senator Lummis stated, this could mark the beginning of a 'crypto war'. China may already be holding closed-door discussions on the topic, observing U.S. actions amidst its national debt exceeding $36.2 trillion.
Bitcoin Price Outlook
Bitcoin's price has shown a significant jump recently, reaching $95,000. After closing the CME gap between $80,670 and $78,000, a new gap has formed suggesting possible price correction. Despite a potential decline to fill the new gap, the price remains in a bullish trend between the 50-day and 200-day moving averages. February trading began with a strong bullish tone, suggesting further growth towards the $100,000 mark.
Despite recent fluctuations, the crypto market continues to grow thanks to government initiatives. However, signs of instability persist, creating a complex environment for market participants.
