Bitcoin’s price surged past the $11,000 mark Monday for its highest daily close in 2020 in a convincing rally that saw the benchmark cryptocurrency leaving the majority of the altcoins behind.
After a convincing move past $10,000 last week, Bitcoin plowed through all resistances in less than 24 hours to specifically overcome $10,500, a major resistance level that Bitcoin failed to break over the past 12 months. It did so Monday with significant volume.
Just before the daily close, BTC fell from $11,242 to $10,795. However, the bulls seemed determined to close the day above $11,000. They did so at $11,048, an 11 percent price increase over the previous day.
If $11,000 remains well supported, the next target is $11,723, which Bitcoin has not reached since March 2018. A bullish move above it will allow BTC to revisit another high-water mark of $13,100.
The price rally resulted in $118 million short liquidations on BitMex. Bitcoin’s dominance in the crypto market currently stands at 63.2 percent while trading currently at $11,192.
Bitcoin may have separated itself from the altcoins again, which it always did during large price movements. However, the altcoins were the first to rally before the benchmark cryptocurrency. This led analysts to believe that traders’ profits from altcoins are now being used to buy Bitcoin.
Major altcoins in the top 10, particularly those that are often compared to BTC, rallied and printed minor gains as well, suggesting that if traders did not convert to fiat or fiat-pegged stablecoin like USDT, they are betting only on Bitcoin and the major coins.
The sentiment is shared by Eric Turner, crypto and data researcher at Messari Crypto. In an interview with Fortune, Turner said traders are putting their gains, like profits from decentralized finance (DeFi), primarily to Bitcoin and Ethereum. Such activity drives up the entire crypto market.
The announcement last week from the Office of the Comptroller of the Currency that banks are allowed to custody crypto also may have played a role in the upsurge. According to OCC’s acting chief, the move would allow banks to leverage new ways to provide service to their customers.
This change is significant because cryptocurrency custody is currently dominated by firms like Coinbase. First, it could entice traditional institutional investors who prefer doing business with banks. Finally, it gives users more ways to protect their cryptocurrency.