Bitcoin rises on capital flight from bonds

BTC rose 3.5% on Tuesday. At the peak of the day, the rate was above $43.2,000, but on Wednesday morning it fell back to $42,000, showing a 0.7% correction. Ethereum is down 1% over 24 hours, while the other top 10 leading altcoins showed mixed momentum yesterday: from a 2.7% decline (Avalanche) to a 3.8% rise (Polkadot).

According to CoinMarketCap, the total crypto market capitalization decreased by 0.5% to $1.91 trillion. The Bitcoin Dominance Index fell 0.1% to 41.9%. The Cryptocurrency Fear and Greed Index added another 5 points to 31, although it remains in a state of “fear”.

Bitcoin tested 19-day highs above $43,000 backed by stock indices, with Chinese stocks mainly pulling it. BTC rose sharply during the Asian session, adding around $2,000 within hours, although a corrective mood then prevailed. Bitcoin clearly has no reason to be a strong establishment on the path to growth just yet.

For now, on-chain metrics are consistent with a bear market, Glassnode notes. The increase in implied volatility and the increase in leverage in the derivatives market indicate the possibility of a strong move in bitcoin.

However, the sell-off of “defensive” government bonds from developed countries continues in financial markets, as investors put their money into stocks and commodities that offer the best hedge against prolonged and high inflation. At the same time, there are no clear signs of an economic and financial catastrophe that could hurt stocks or commodities.

The world’s largest hedge fund, Bridgewater Associates, plans to invest in one of the third-party crypto funds, highlighting the risks for fiat currencies, which lose heavily during times of military and economic wars.

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