Bitcoin Hits $23,000 for the First Time Since June 13th

Bitcoin, Gary Gensler, and Celsius

Good news, but with some caveats

Bitcoin has hit $23,000 for the first time since June 13th. The bullish sentiment is largely due to the crypto market's current correlation to the stock market, which rose significantly after reports that gas prices are starting to noticeably decrease, and earnings reports are also on the positive side. The latest rally is also partly due to a short squeeze, as noted by Bitcoin Magazine.

In addition, Gary Gensler recently promised a "considerate" approach to regulating the crypto industry, while also mentioning that crypto companies can largely be exempt from normal securities regulations. 

This, however, will not change their eventual crackdown on governance tokens and other DeFi protocols, which Gensler has stated on multiple occasions are securities. In fact, Gensler believes that Bitcoin is the only cryptocurrency which doesn't fit the definition of a security. US Congressman Tom Emmer criticized Gensler via Twitter for his many inconsistencies, but ironically, it was found that Emmer actually voted against a bill which would increase market transparency.

Days earlier, Russian President Vladimir Putin, who is overseeing a months-long invasion of Ukraine, decided to ban cryptocurrency payments. This was a win for the critics of Bitcoin and other crypto; as previously, there was speculation that the Kremlin would use crypto to get around the many sanctions enacted by western countries in response to their Ukraine war. This didn't appear to affect the crypto market largely.

What's next?

Now that Celsius is in bankruptcy court proceedings, the sell pressure on crypto has diminished significantly. Celsius lawyers stated in court, to one's surprise, that once users deposited crypto on their platform, they lost their right to it.

Despite these recent positive revelations, it's clear that Bitcoin and the rest of the crypto market are still largely correlated to the stock market. This will slowly change over time as regulations become more clear and retail investors HODL their coins.

The market is far from recovering to its previous levels, since macroeconomic statistics are still showing signs of a potential recession. Although, with many people not anticipating this recent decrease in American gas prices, there's a chance that the next GDP reading could be better than expected, thus avoiding a recession.

If economic data continues to improve, then Bitcoin will likely rise to its previous levels. Whether this is a dead cat bounce or not, depends largely on whether any more sizable protocols like Terra or Celsius will fall.