Crypto market in January: Bitcoin takes off again, and Musk considers creating an altcoin for Twitter

In January, Bitcoin (BTC) almost repeated the price record: the coin traveled by 39.4%. The last time such a rise was recorded in October 2021, when the main cryptocurrency increased by 40%. This still remains the largest monthly growth over the past 10 years. The optimism of the market was added by the slowdown in inflation and the hope for a softer position of the Fed on raising key rates.

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Together with the crypto exchange Changeit, the Ministry of Finance summarized the work of the crypto market last month and analyzed what is happening on it now. The growth of the number one cryptocurrency began in mid-January, after the publication of data on the slowdown in inflation in the United States: in December, the annual price growth was only 6.5%, which turned out to be lower than expected by experts. Inflation reached its peak in June and has been falling ever since.

Such data gave investors hope that the Fed will slow down the increase in the key rate, and in the near future it may even abandon it altogether. The stock market and most cryptocurrencies reacted with growth.

Bitcoin’s meteoric rise allowed Goldman Sachs to call it the best asset at the beginning of the year, even taking into account the risk margin.

The second most popular cryptocurrency in the world — Ethereum (ETH) — gained 32.4% in January, the third Binance coin (BNB) — 26%. High growth was demonstrated by the key crypto market index CMC Crypto 200 (tracks the price of 200 of the most popular cryptocurrencies, excluding stablecoins and bitcoin). In a month, he added 35.5%.

In addition to macroeconomic indicators, the cryptocurrency market was positively influenced by the growth in the interest of institutional investors, who demonstrated the highest demand for these assets over the past 6 months. Also, against the background of positive news, traders actively closed short positions in cryptocurrencies, which also became an additional factor in their price growth.

Rapid growth of Solana

High performance was demonstrated by Solana (SOL), a coin that fell sharply in the past months due to its proximity to the bankrupt FTX exchange. In January, the token immediately rose by 138%. This is mainly due to the fact that towards the end of last year, it had its deepest fall, and against the background of general optimism, it pushed off the bottom.

Some other positive news, for example, the launch of its own meme coin and the start of pre-orders for its smartphone, had less impact on the price of the coin.

However, Solana is still about 10 times cheaper than at its peak in October 2021. And experts warn that trust in the ecosystem has significantly decreased.

Twitter will launch its own cryptocurrency

Discussion of the possibility of creating Twitter’s own cryptocurrency began immediately after the acquisition of the social network by Elon Musk.

In January, such assumptions were confirmed. Technical researcher Jane Manchun Wong reported on the work on its integration.

The new function will allow users to be financially rewarded for publishing. The reward will be an internal Twitter token that can be purchased for fiat.

The possibility of integration of cryptocurrencies was confirmed by Elon Musk himself.

“There is no problem for Twitter to accept payments in both fiat and cryptocurrency,” the billionaire said.

Changeit is a Ukrainian online cryptocurrency exchange for fast and profitable exchange of cryptocurrency. The service has no hidden payments and supports any Ukrainian bank cards.

Currently, the exchange has 7 main currencies: UAH, BTC, ETH, USDT, LTC, DOGE, DASH. Half of the commission for Changeit operations is given to the Armed Forces of Ukraine.

Author: Journalist Aleksey Pisarev writes on the following topics: Investments, stock market, forex, macroeconomics

Source: Ministry of Finance

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