Zimpapers Logo

Bitcoin climbed to the highest level in more than two weeks amid a boost to investor sentiment from a deal on raising the US debt limit.

The largest digital token added as much 3,2 percent on Monday and was trading at US$28 182 as of 9:32 a.m. in Singapore, oscillating around its 50-day moving average. Smaller tokens ranging from Ether to Binance Coin also posted gains.

The debt-ceiling deal between President Joe Biden and House Speaker Kevin McCarthy has helped risk appetite in global markets. But the agreement still has to clear Congress quickly to avert a US default. A recent jump in Treasury yields and bets on more US monetary tightening are other potential headwinds.

“This morning’s positive risk sentiment directly relates to the resolution of the debt-ceiling impasse,” said John Toro, head of trading at digital-asset exchange Independent Reserve. “Front-end funding costs remain highly elevated relative to crypto returns, resulting in negative carry for long holders. This will continue to prove a headwind for risk assets and the crypto complex.”

Bitcoin is on a five-day streak of gains — its best stretch since March — alleviating a challenging quarter due to poor liquidity and a US crackdown.

Crypto markets have partially rebounded in 2023 from a rout last year that led to blowups such as the collapse of the FTX exchange. But they remain well off record highs, including Bitcoin’s all-time peak of almost $69,000 in 2021.

“It is possible the sheer relief of a debt deal will bring traders back to the table and trigger the next big leg-up in the price of Bitcoin,” said Tommy Honan, head of market analysis at crypto exchange Swyftx. – Bloomberg