For the first time since FTX declared bankruptcy, Bitcoin (BTC-USD) traded above $20,000. The core crypto is up for two reasons. U.S. inflation rates are falling. In addition, FTX recovered over $5 billion in assets, according to bankruptcy attorneys.
Bitcoin investors are betting that the mass withdrawals from platforms would end from here. Frantic sellers cashed out on crypto for weeks after the FTX fall.
Landis Rath & Cobb attorney Adam Landis said that FTX located over $5 billion of cash, liquid crypto, and liquid investments. This gives FTX account holders hope that they will get some money back. As the weeks pass, the attorney could report higher amounts recovered.
FTX likely has over 9 million creditors.
Inflation Tame
Separately, the U.S. inflation report added to last week’s renewed interest in Bitcoin. Dec. 2022 inflation fell to a 6.5% annual reading, down from 7.1% in Nov. 2022.
Crypto markets traditionally treat their currency as a hedge against inflation. That view accelerated BTC’s sudden break-out from the $16,600 level to over $20,845 on Jan. 14, 2023.
Your Takeaway
Both Bitcoin and Ethereum have relative strength over other cryptocurrencies. After the strong recent performance, crypto investors should consider BTC as a core holding again.
