Bitcoin (BTC) Recovers: 5 Reasons for Going Above $10,000 Again

BTC prices showed worrying weakness - but once again, BTC avoided the predictions to return to lower valuations.

Bitcoin (BTC)is back up again - avoiding once again the predictions of falling through to a lower valuation, possibly below $8,000 based on pessimistic estimations. After hovering around $9,500, BTC once again bounced strongly late on Tuesday, stopping just above $10,000.

BTC traded as high as $10,100, before retreating slightly to $9,945.83 as of 7:15 UTC on Wednesday. Here are the factors supporting BTC prices in the new month:

End-of-Month Euphoria

BTC prices failed to form a decisive trend in July, instead of moving within a range, failing to break above the $11,000 mark. As the end of July approached, trading up may have become a self-fulfilling prophecy. Also, the move is within the usual range for BTC, which has returned to volatility. Days of adding hundreds or even thousands of dollars are not rare.

Forgetting Regulator Pressures

After Tuesday passed, and the US Senate Banking Commission hearing went with the usual criticisms against BTC, the news did not sound so bad. Just a day after the hearing, prices moved up again, and quickly. Even news that Facebook doubted the launch of the Libra digital coin failed to weigh down BTC - which, after all, had no trouble with a 10-year history under its belt.

Mining Leads the Game

Mining is peaking to unprecedented levels, breaking a record every few days. Lately, thehashrateclimbed to 78 EH/s, on track to double since May’s levels. The attractiveness of the Bitcoin network means the asset will not be abandoned. With around 290 days left until the halving of the block reward, BTC will become even more scarce.

Whales Swimming Away

One of the recent drops under $10,000 was blamed on whales pushing the price down. But even whales are not present at all times. Pushing down the BTC price happens only temporarily - as in the case of the flash crash last weekend, where BTC lost hundreds of dollars and recovered quickly. BTC is now much more liquid, with enough Tether (USDT) to boost trading and counter the attempts to bring down the price.

Fed Interest Rate Cut

The Fed cut its interest rate for the first time since 2008. The promise of higher liquidity, and even greater quantitative easing may add to the sentiment of ever-rising markets. With stocks still near peak levels, there is enough optimism and exuberance to boost BTC, even in the longer term.

Additional factors such as the Bakkt futures testing period may also boost BTC prices. The $10,000 level has been defended more than three times last month, giving hopes that BTC can hold onto relative stability, even if not breaking the yearly record.