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Cryptocurrency illustration. / Yonhap

Bitcoin and Ethereum have both gained around 10% over the past week, signaling a clear recovery across the cryptocurrency market. The rally appears to be driven by revived appetite for global risk assets—spurred by falling crude oil prices and anticipation surrounding an upcoming U.S.-China summit—combined with strong capital inflows into U.S. spot Bitcoin exchange-traded funds (ETFs).

According to U.S. cryptocurrency exchange Coinbase on the 22nd, Bitcoin was trading at $85,714 as of 12:00 p.m., up 5.59% from the previous day and 10.01% higher compared to a week earlier. Ethereum was also changing hands at $2,740, up 3.12% on the day and gaining 9.06% over the week.

The rebound has been largely attributed to a resurgence in global risk appetite. Recent drops in international oil prices have eased inflation and interest rate pressures to some degree, while growing expectations of reduced trade friction ahead of the bilateral summit between the U.S. and China have bolstered investor sentiment. On Wall Street, tech stocks led gains on the 21st, and Bitcoin mirrored this broader risk-on shift.

Improving capital flows within the digital asset market also provided momentum. U.S. spot Bitcoin ETFs recorded net inflows of $159.5 million on the 17th and $433 million on the 18th, highlighting a sharp turnaround in recent fund movements. In particular, the single-day inflow on the 18th illustrated the scale of rebounding demand for these ETFs.

A notable feature of the latest bounce is that it extends beyond Bitcoin, lifting Ethereum and other major altcoins in tandem. Buying pressure, previously concentrated in Bitcoin, is broadening into Ethereum and other tokens, improving sentiment across the entire cryptocurrency landscape.

Market observers point to sustained net inflows into spot ETFs as a critical variable for prolonging the uptrend in Bitcoin and major altcoins. While ETF flows have turned positive, substantial outflows were observed through mid-September, making it premature to declare institutional demand fully recovered based on short-term inflows alone. Whether institutional capital consistently flows into ETFs alongside robust spot buying is seen as the central gauge going forward.

Interest rates present another variable. Bitcoin climbed even after the Federal Reserve raised its benchmark rate by 25 basis points last week, suggesting the market has absorbed higher rates to some extent. However, if inflation and Treasury yields climb once more, valuation pressures across risk assets could resurface. A renewed strengthening of the dollar and U.S. Treasury yields could place the brakes on cryptocurrency gains.

Market analysts anticipate further upside if Bitcoin can hold the mid-$80,000 range, backed by sustained ETF inflows and a stable macroeconomic backdrop. Chris Beauchamp, Chief Market Analyst at IG, remarked on the synchronized crypto rally, noting that recent inflows are reinforcing upward momentum and could draw additional capital into the space, adding that investors appear to recognize they can navigate a higher U.S. rate regime.

Nicolai Søndergaard, Senior Research Analyst at Nansen, said that breaking above $85,000 and establishing support could pave the way toward $87,000, bringing the psychological resistance mark of $90,000 into focus.

                                                                                                                Kim Min-ju