Crypto markets rallied despite US measures

Bitcoin jumped 11 percent to $24,655.94 around 3:36am ET, while ether rose more than 8 percent to $1,684.59, according to CoinDesk.

The value of the entire cryptocurrency market increased by more than $84.8 billion in the 24 hours before 3:39am ET.

There are growing signs that the market has passed last November’s bottom and is now bullish, said Vijay Aiyar, vice president of corporate and international development at crypto exchange Luno.

Crypto markets were on edge before this week following expanded regulatory scrutiny by US authorities on digital currencies.

On Monday, the New York State Department of Financial Services informed Paxos to stop coining new Binance USD or BUSD stablecoins. A stablecoin is a type of cryptocurrency linked to real assets, and some are backed by bonds or cash. The BUSD is pegged one-to-one to the US dollar.

Pakos also confirmed that the Securities and Exchange Commission had notified the company that the agency might recommend a stock that is said to be a BUSD security. The SEC has not yet formally filed charges against Paxos.

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On Thursday, the price of bitcoin hit its highest level since mid-August 2022. Last year, nearly $1.4 trillion was wiped from the crypto market after the turmoil that led to bankruptcies, failed projects, and companies. The collapse of the major stock exchange FTX supplemented all of this.

Gary Gensler, chair of the SEC, reiterated last year that the agency views bitcoin as a commodity, not a security. Commodities are assets like gold, while stocks are considered securities. They are regulated differently.

Rising interest rates from the Federal Reserve prepared to combat inflation also reflected on crypto markets. Bitcoin is closely linked to the capital markets, particularly the tech-heavy Nasdaq index. The Nasdaq has been up about 16% since the beginning of the year. Bitcoin has exceeded the index and is higher by 49% this year.