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Bitcoin jumped above US$42,000 amid a sharp rally in digital tokens, spurred by optimism about a sweeping US overhaul of crypto oversight that Treasury Secretary Janet Yellen called “historic.”
The largest cryptocurrency rose as much as 10 percent to US$42,427, its highest level since March 2. Ether climbed 8 percent while so-called privacy coins like Monero posted large gains. The crypto advance came as a broad risk-on rally embraced European stocks.
Yellen praised an upcoming executive order from US President Joe Biden in a statement on the Treasury’s website that was later removed, saying it strikes the right balance between fostering innovation and addressing potential risks. That boosted sentiment in an industry that has long called for greater regulatory direction.
“For years, the crypto market has been hindered by a lack of regulatory clarity in the US,” said Hayden Hughes, chief executive officer of trading social-media platform Alpha Impact, in a message yesterday.
“If clear guidelines are passed, this could be a watershed moment for the industry.”
Yellen said the department’s efforts under the executive order would complement work that’s already been done, including the report the President’s Working Group on Financial Markets put out last year on stablecoins.
In the since-removed statement dated March 9, Yellen said the approach outlined in the order “will support responsible innovation that could result in substantial benefits for the nation, consumers, and businesses.”Even after Wednesday’s rally, Bitcoin remains within the range of US$33 000 to US$48 000 where it’s traded most of this year.
After diverging from stocks early last week, cryptocurrencies gave up most of those gains as the war in Ukraine escalated, pouring cold water on the argument that they’re a safe haven in times of geopolitical turmoil.
Privacy upside
Privacy coins — so called for the higher degree of anonymity they afford users — were some of the biggest winners over the past 24 hours, with Monero jumping 21% and Zcash up 17%, based on CoinGecko data.
The gains were driven by speculation that they may get payment traffic displaced by the sanctions on Russia.— Bloomberg
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