Bitcoin Surges 20% to $116,500 on Fed Rate Cut Hopes

Bitcoin recently surged past $116,500, marking a new all-time high and a nearly 20% increase since the start of the year. This rally was primarily driven by several bullish factors, including expectations of a rate cut by the Federal Reserve, the signing of a tax expenditure bill, and the easing of global trade tensions. These developments have intensified the market's demand for safe-haven assets like Bitcoin.

The breakout has sparked discussions about whether Bitcoin can sustain its upward momentum, particularly whether it can reach the psychological barrier of $200,000. According to Adam Guren, Chief Investment Officer of Hunting Hill, the current surge in Bitcoin is driven by a combination of ETF inflows, increasing institutional adoption, and a favorable macro environment. Unlike previous cycles, the current demand for Bitcoin is structural, regulated, and sticky, suggesting that its upward momentum may continue.

Additionally, the rise in the M2 money supply and institutional inflows have provided further support for Bitcoin's price increase. An analyst from CryptoQuant noted that most Bitcoin holders are still in a profitable state, which provides additional market support. While there is a risk of short-term profit-taking, Bitcoin maintains a strong upward trend.

Some experts believe that if the current market trend continues and the M2 money supply keeps increasing, Bitcoin could see further price increases by the end of the year, potentially reaching $150,000 to $200,000. This optimistic outlook is based on the structural and regulated demand for Bitcoin, which differs from previous market cycles.

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