Bitcoin reclaims US$28,000 on US debt ceiling talks

Bitcoin moved back above US$28,000 in Monday morning trading in Asia, leading a rally among all top 10 non-stablecoin cryptocurrencies. Ethereum also reclaimed the US$1,900 resistance level. The surge in cryptocurrencies followed an in-principle agreement between President Joe Biden and House Speaker Kevin Mccarthy to raise the country’s debt ceiling. The move has boosted investors’ appetite for risk assets. Meanwhile, U.S. equity futures rose Friday, with further positive sentiment over the weekend following in-principal agreement on U.S debt talks.

Crypto

Bitcoin rose 3.98% over the last 24 hours to US$28,195 at 9:30 a.m. in Hong Kong. It recorded a weekly gain of 5.73%, according to data from CoinMarketCap. The world’s largest cryptocurrency is trading above the US$28,000 resistance level for the first time since May 10.

Ether also jumped 3.48% in the past 24 hours to US$1,916, moving up 6.53% over the past seven days. It was trading above the US$1,900 mark for the first time in three weeks.

Cryptocurrency prices received a boost from U.S. debt ceiling talks. 

U.S. President Biden announced Saturday that he had reached an in-principle budget agreement with House Speaker Kevin McCarthy. If ratified, the agreement would suspend the government’s debt limit through Jan. 1, 2025. 

Both parties are now urging U.S. Congress to pass the deal by June 5 – the debt default deadline set by Treasury Secretary Janet Yellen. If an agreement is not ratified by that date, the government would no longer be able to pay its debts. Such an outcome would prove devastating for U.S. and global markets.

The sense of relief among investors that a deal is on the verge of completion has led to “fresh buying of risk assets,” said Markus Thielen, Head of Crypto Research & Strategy at digital asset service platform Matrixport, in a note shared with Forkast. 

“So many investors were scared about the debt ceiling and the potential default by the U.S. government – which is just so unlikely. Now, they need to find something else to be bearish about while the market likely rallies,” said Thielen.

With Bitcoin taking the lead, all other top 10 non-stablecoin cryptocurrencies traded higher over the past 24 hours. The total market cap for cryptocurrencies rose 3.00% in that period to US$1.17 trillion. The 24-hour trading volume also jumped 57.01% to US$31.73 billion.

Neo, the token that supports China-affiliated Neo blockchain, saw the largest weekly gain in the top 100 cryptocurrencies. It rose 23.83% to US$11.37. Neo is backed by Onchain, a Chinese blockchain company and member of the country’s internet finance industry lobby.

Neo outperformed most other larger-cap cryptocurrencies in the past week with investors now “positioning themselves for the Hong Kong opening event,” said Thielen of Matrixport.

The special administrative region of China will unlock trading for retail investors from June 1, as the city seeks to become a hub for the crypto industry.

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• Source: https://forkast.news/bitcoin-28000-us-debt-ceiling-talks/