Great comeback: Has crypto winter really ended?

The crypto market opened the week with its sharpest movement since August.

As of the morning hours, Bitcoin was trading at around $85,500, a daily increase of about 5% and a weekly rise of about 10%, after crossing $87,000 during trading to reach its highest level since January. Ethereum was trading around $2,734, up about 2.7% on the day and roughly 9.4% for the week. XRP jumped about 6.4% to $1.51, and Solana was trading around $116.7 after a nearly 15% weekly surge. Dogecoin stood out even more with a weekly increase of about 21%.

The market capitalization of the entire crypto sector climbed to about $2.9 trillion, a gain of nearly 4% in 24 hours, as trading volumes nearly doubled.

The reason begins entirely outside crypto

The rally is not disconnected from events in traditional markets.

On Monday, the Nasdaq jumped 2.26% to a new record, driven by a rally in technology stocks. At the same time, the yield on US 10-year Treasury bonds fell below 5%, and oil prices retreated following hopes for an easing of tensions in the Middle East.

For crypto, this is a relatively favorable combination. Cheaper oil reduces some inflation fears, falling yields make bonds less attractive relative to risk assets, and gains in tech stocks signal that investors are once again willing to take on more risk.