Cryptocurrency Markets Rally Despite Moody’s Downgrade; Ether Soars 8% as Bitcoin Approaches $106K
Despite Moody’s recent downgrade of the U.S. credit rating, crypto markets showed notable resilience over the past day. Ether (ETH) surged by 8%, while Bitcoin (BTC) edged back toward the $106,000 level, contrasting sharply with declines seen in stocks and gold.
Friday’s credit downgrade rattled traditional markets, dragging stocks lower and pushing gold down nearly 7% from its recent highs. However, bitcoin defied the risk-off sentiment, briefly rallying above $107,000 late Sunday before settling near $105,000 in Monday trading.
“Bitcoin’s ability to rally amid a risk-averse market underscores its growing role as a digital store of value,” said QCP Capital in a Telegram message. They attributed this strength to steady institutional inflows into spot bitcoin ETFs, even as leveraged long positions in derivatives markets experienced some liquidations.
Ether’s robust 8% gain pushed its price above $2,900, fueled by renewed enthusiasm around Ethereum staking and optimism following the Pectra upgrade, though no new news specifically drove Monday’s price action.
Other major altcoins, including Solana (SOL), XRP, BNB, and Dogecoin (DOGE), rose between 2% and 4%, while the CoinDesk 20 index gained just under 2%.
Aave’s (AAVE) token posted an impressive 25% rally, albeit with no immediate protocol updates or governance changes, suggesting speculative activity. Despite this, AAVE remains far below its 2021 peak.
Market analysts are highlighting an emerging divergence between bitcoin and traditional hard assets like gold.
“Bitcoin is rising even as gold declines, marking a departure from earlier trends where the two moved in tandem,” noted Augustine Fan from SignalPlus. “Gold ETFs are experiencing outflows while bitcoin ETFs see inflows, mirrored by futures data on CME, signaling potential new opportunities from these shifting correlations.”
