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The biggest cryptocurrency rose as far as $28,567, its highest
since mid-June, and was last up 0.9%, amid growing expectations
that central banks would slow the pace of interest rate hikes.
Bitcoin rose 26% last week, its best weekly gain since April
2019, and has soared some 40% in 10 days as turmoil in the
banking sector rippled around the globe - culminating, so far,
in UBS Group's takeover of rival Credit Suisse Group AG over the
weekend.
Traditional assets such as banking stocks and bonds plummeted on
Monday after UBS sealed its state-backed takeover of Credit
Suisse, a deal orchestrated in an attempt to restore confidence
in a battered sector.
Top central banks, faced with the risk of a fast-moving loss of
confidence in the stability of the financial system, moved on
Sunday to bolster the flow of cash around the world. Such a
global response has not seen since the height of the COVID-19
pandemic.
"Its stunning rally is the result of the banking crisis, and as
the interest rate markets prices in rate cuts in the second half
of 2023," said Tony Sycamore, an analyst at IG Markets,
predicting a move towards $32,000 should bitcoin hold above the
key support level about $25,000.
Other market players predicted that bitcoin would benefit from
central bank efforts to bolster liquidity in the global
financial system. It rose to a record of $69,000 in November
2021 after central banks and governments launched unprecedented
monetary and fiscal stimulus measures.
"The momentum is all driven by liquidity," said Markus Thielson
at digital asset firm Matrixport in Singapore.
(Reporting by Tom Wilson in London and Georgina Lee in Hong
Kong; Editing by Christian Schmollinger)
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