Bitcoin rally continues

12 Sep 2022

Bitcoin hit $22,000 on Monday morning as it continues a week-long rally ahead of the Ethereum Merge and U.S. inflation data.

The world’s largest cryptocurrency by market cap reached $22,341.50 early on Monday before retreating slightly, as per data from CoinDesk. At the time of writing, the Bitcoin price stood at $22,203.

Indeed, since falling under the $19,000 mark last Wednesday, to its lowest point since June, Bitcoin has rallied around 17%, CNBC reports.

The rise also follows a strong week for U.S. stocks last week. Bitcoin has been closely linked to equity markets, especially the Nasdaq, and often edges up when the index rises.

Investors are focused on the U.S. consumer price index report for August, due to be published on Tuesday, to see the trajectory of inflation.

Digital currencies, also risk assets, have had a rough ride, with close to $2 trillion wiped off the crypto market since its record high in November, and the world’s largest cryptocurrency is down more than 50% in 2022.

However, the Ethereum network is undergoing the long-awaited ‘Merge’ this month, taking the blockchain from a proof-of-work to a proof-of-stake model, and considerably reducing the energy needed to operate the network.

Advocates say this upgrade could make way for increased use of Ether, the CNBC report adds.

“Crypto faces an unusual double whammy this week: U.S. inflation data and [hopefully] the long-awaited and oft-delayed Ethereum Merge. Hold your breath for a rollercoaster ride,” said Antoni Trenchev, co-founder of Nexo, on Monday.

“In a time awash with narratives, there’s none bigger than the Merge in crypto and it’s one which the wider world should take notice of with Ethereum’s carbon footprint set to be slashed by 99%.”