Bitcoin Jumps Above $86,000 to 8-Month High — 4th Update

By Joseph Wilkins and Dean SealBitcoin surged above the $86,000 mark on Monday, hitting an 8-month high.The flagship cryptocurrency continued its red-hot rebound, adding 6% to $86,054 after an uplift of nearly 6% last week. Investors shrugged off two potential hurdles--a failure to pass the Clarity Act, as well as the Federal Reserve's quarter-point interest-rate hike--to finish the week higher.It is now up over 30% since Aug. 19 and is holding firmly above the $80,000 level that has proved a stubborn cap in recent weeks.Bitcoin's recent move higher has been supported by stronger exchange-traded fund inflows, positive regulatory developments and investors closing earlier bets against the cryptocurrency, wrote Zaye Capital Markets analyst Naeem Aslam in a note."Perhaps investors are realizing that they can live in a world of higher U.S. rates, though falling oil prices certainly help too," said Chris Beauchamp, IG's chief market analyst.Monday's rally spread to other crypto-related assets, with Coinbase Global and Robinhood Markets each adding 4.3% during the trading session, respectively."This leg looks different," Yusuf Fakhro, partner at Bahrain-based platform ARP Digital, said. "It is being led by steady inflows into U.S. spot Bitcoin ETFs, which came back strongly after the Fed decision and recovered most of the outflows seen around it. That demand has been enough to absorb the coins long-term holders are selling into strength, which is exactly what you want to see."The latest rally has happened without much participation from crypto-native holders, Nansen analyst Nicolai Sondergaard said. The biggest bitcoin traders on the Hyperliquid exchange are still net short and more bitcoin has come onto exchanges than left them in the past two days, he said.That means the run-up could reverse if ETF inflows weaken or U.S. Treasury yields push higher again, according to Sondergaard, On the other hand, he said, sustained spot and ETF flows could keep the rally hot.Investors are looking ahead to the planned summit between U.S. President Trump and Chinese President Xi Jinping on Thursday. A truce in the tariff war is due to expire Nov. 10, and any progress made to ease trade tensions could boost sentiment for risk assets including cryptocurrencies.Write to Joseph Wilkins at [email protected] and Dean Seal at [email protected]