Bitcoin surged during the Asian session on Sunday, rallying from $122,000 to $124,289 within minutes, pausing short of the record high of $124,429 reached in August.
The break above $124,000 followed a massive demand for U.S.-listed spot exchange-traded funds (ETFs). which collectively registering a net inflow of $3.24 billion last week. This marks the second-largest weekly inflow on record, according to data provider SoSoValue.
Other tokens such as XRP, ETH, SOL, DOGE followed BTC’s lead, gaining 1% to 3% during the Asian hours.
Haven demand
BTC’s rally arrives against the backdrop of a continued U.S. government shutdown, which analysts say has heightened safe-haven demand for the top cryptocurrency.
Jeff Dorman, Chief Investment Officer of Arca, noted just before the shutdown began, “The only time I buy BTC is when society loses faith in governments and local banks. $BTC likely a good buy here ahead of yet another U.S. government shutdown.”
Beyond political uncertainty, experts point to significant macroeconomic factors driving the rally.
Noelle Acheson, author of Crypto Is Macro Now newsletter, explained, “beyond the escalating risk of new conflicts, US inflation is more likely to increase than decrease, increased borrowing around the world will intensify currency concerns, and what’s good for gold is also good for BTC, especially since it is still woefully under-allocated.”
“Plus, the incoming rush of market support – lower rates, yield curve control and lots and lots of “money printing” – will boost global liquidity, which will seep into the riskier corners of institutional portfolios,” she added.
In short, BTC looks set to chalk up impressive gains during the seasonally bullish month of October. At the time of writing, the cryptocurrency was trading around $124,080, according to CoinDesk data.
