Abel Ndooka
Crypto prices are rising once again, with many of the alternatives to bitcoin outperforming on Thursday as investors expand their holdings at the start of the new year.
Bitcoin rose as much as 2,9 percent to US$97 526, while altcoins like Ether, XRP, and Dogecoin jumped more than 4 percent, and Solana climbed as much as 8,2 percent as of 11:49 am in New York.
“Heading into the new year, market participants have started to diversify their exposure by allocating capital to representations of more speculative narratives,” said Chris Newhouse, director of research at Cumberland Labs.
Crypto starting the year in the green may also be due to digital assets historically performing well in the first quarter, according to Newhouse.
“Market dynamics suggest continued capital rotation into various thematic sectors,” Newhouse said. “This seasonal strength, combined with improving macro conditions and interest in narratives beyond BTC and ETH, acts as a strong tailwind for altcoins.”
Crypto-dependent stocks also gain on the first day of trading in 2025.
Coinbase rose as much has 5,6 percent, MicroStrategy increased as much as 7,3 percent and MARA Holding jumped more than 8 percent at one point.
While crypto prices are seeing gains, they are still below the highs they saw in December before dropping. But this could be helping to fuel some of the buying according to Strahinja Savic, head of data and analytics at FRNT Financial Inc.
“Rallies among alts like the one we are seeing today are investors following the popular crypto mantra of ‘buy the dip’ in anticipation of the bull market’s continuation,” Savic said.
“For most crypto investors, the fundamental case for this bull market remains intact despite the volatility.”
Many investors are expecting a more friendly regulatory environment for crypto this year with Donald Trump’s incoming US presidency.
Altcoins that have previously faced scrutiny from the US Securities and Exchange Commission have seen large inflows since Trump’s election victory and his nomination of crypto supporters to his administration.
Altcoins also tend to be more volatile than Bitcoin, which can mean larger gains and losses. — Bloomberg.
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