The cryptocurrency market rose as attempts to strengthen the banking system and expectations that the US will begin decreasing interest rates later this year boosted investor confidence.
Bitcoin, the most valuable token, surged as much as 4.9% to over $25,610 as of 10:45 a.m. in Singapore on Friday.
Second-placed Ether gained about 3%, while smaller currencies such as Solana and Polkadot also increased.
“Any sign of interest-rate cuts should push funds to riskier assets, which is likely to be enough to bring more institutional funds into the crypto market, regardless of whether macro traders understand or believe in the longer-term Bitcoin investment thesis,” wrote Noelle Acheson, author of the “Crypto Is Macro Now” newsletter.
Bitcoin has risen around 55% this year and is on the verge of reaching its highest level since June 2022.
But, the token is still a long way from its November 2021 high of about $69,000.
Concerns over the banking industry following the failure of three small US bankers and pressure on Credit Suisse Group AG have sparked a strong surge in sovereign bonds as investors seek for perceived safe havens.
“The plunge in yields is welcome news for many crypto startups,” Edward Moya, senior market analyst with Oanda Corp., wrote in a note.