Bitcoin climbed past $86,000 at the start of this week, extending a strong recovery that has lifted the crypto sharply over the past week. Data from CoinMetrics showed Bitcoin at $85,863, representing a gain of about 5.8%. The digital asset had earlier reached $86,349, its highest point since late January.
The recent surge has reignited discussion over whether the extended slump in cryptocurrency markets may finally be coming to an end. Bitcoin reached a record of $126,000 in October last year before entering a period of weaker prices.
Bitwise CIO Matt Hougan said on Monday that the downturn could give way to a new phase of expansion. He described the current environment as “crypto spring” and argued that the sector could enter its strongest and most sustained bull market to date.
Bitcoin has advanced at least 8 percent over the last seven days and about 34 percent over three months, although it remains considerably below its previous peak.
Hougan noted that the underlying crypto industry had not deteriorated despite the decline in market prices. He cited rising involvement from mainstream financial institutions such as BlackRock, along with increased blockchain activity, as evidence of improving fundamentals across the crypto sector.
His view is that prices could eventually reflect those improvements. He said he would not expect Bitcoin to remain below its previous record into next year.
BTIG analysts also pointed to the possibility of further gains, saying in a Sunday note that maintaining a level around $75,000 would leave room for Bitcoin to move beyond $82,000 and potentially toward $90,000.
Shares of companies tied to the cryptocurrency market, including Coinbase and Strategy, also gained during U.S. trading.
The recent rally has taken place against a complicated regulatory backdrop. The Senate recently voted to block the Clarity Act from moving forward. The proposed legislation sought to establish a broader regulatory framework for digital assets and clarify roles between the SEC and the CFTC.
Hougan said the setback may not necessarily weigh on the sector. He argued that existing leadership at the two agencies could continue pursuing policies viewed by the industry as supportive of crypto.
He also pointed to a shift in investor attention. According to Hougan, the surge in artificial intelligence (AI) stocks had drawn some investors away from crypto. With the trade losing some of its momentum, he said, capital may now be moving back toward digital assets.
As more capital moves back into digital assets, entities like Cantor Equity Partners Inc. (NASDAQ: CEP) could see their balance sheets improving as the value of Bitcoin rises.
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