Bitcoin Reaches $97K, Cardano’s ADA Surges Before Fed Meeting

Bitcoin experienced a rise above $97,000 late Tuesday, but saw a decline to $96,500 during the early hours on Wednesday in Asia. This fluctuation occurred amidst rising tensions following India’s airstrikes in parts of Pakistan.

A scheduled discussion regarding tariffs between the U.S. and China initially lifted risk assets after the close of the U.S. stock market on Wednesday. However, these gains were reversed following the announcement of India’s “Operation Sindoor” in the early hours.

Market participants anticipate increased volatility in the upcoming days, as ongoing regional conflicts could dampen risk appetite. Ultimately, this situation may drive a bullish sentiment, with Bitcoin viewed as a protective asset.

Nick Ruck, a director at LVRG Research, noted in a message that the volatility in the markets is escalating, coinciding with Bitcoin’s jump to $97K due to the worsening conflict between India and Pakistan.

Ruck further mentioned that this surge follows the U.S. and China’s trading discussions this week. The unexpected upward move came amid investors unwinding risk ahead of the Federal Reserve’s decision on interest rates. Heightened geopolitical uncertainties and macroeconomic instabilities could propel Bitcoin to new heights as a safeguard against broader market risks.

Among major cryptocurrencies, Cardano’s ADA outperformed with a 3% increase over the last 24 hours, building on gains from Tuesday. Other tokens like Dogecoin (DOGE), XRP, BNB Chain’s BNB, and ether (ETH) showed less than a 2% rise, while legacy tokens Bitcoin Cash (BCH) and Litecoin (LTC) surged by as much as 10%.

The CoinDesk 20 index, which tracks the largest cryptocurrencies by market capitalization, increased by nearly 2%.

In addition, some traders have pointed out that Bitcoin’s recent successes are tied to an uptick in active addresses—a statistic some consider indicative of impending volatility.

Ryan Lee, chief analyst at Bitget Research, remarked that the spike in active addresses during Bitcoin’s ascension to $87,500 supports a trend towards the $97,500 range, currently reaching a six-month peak, which reflects growing demand and renewed activity on the network.

Lee also noted that the bullish outlook for a potential move towards $100K depends on several indicators converging effectively.

Traders are advised to keep an eye on macroeconomic conditions, Bitcoin’s dominance nearing 55%, and the upward trend in hash rates. Meanwhile, Ethereum remains within a tighter trading range of $1,600 to $1,900, still lagging behind the momentum of Bitcoin, with sentiment more restrained amid fewer catalysts and cautious shifts towards alternative cryptocurrencies.