Bitcoin Surges Past $5,700 in Hours: Experts Explain Factors of Overnight Rally

Over several hours on May 3, the price of bitcoin spiked from around $5,300 to over $5,700 in major markets, allowing the crypto market to gain more than $7 billion in a single day.

Major crypto assets such as ether, litecoin, bitcoin cash and EOS recorded gains in the range of 4% to 8% against the United States dollar, fueling the momentum of the crypto market.

The abrupt recovery of the crypto market led by the strong upside price movement of bitcoin was largely unexpected due to the controversy surrounding iFinex, the company that oversees the operations of Tether and Bitfinex.

Despite the troubling development in the iFinex-Bitfinex case, the price of bitcoin has increased from $5,135 to over $5,735 in the past week as of press time.

According to the analyst, throughout the past two weeks, technical indicators were pointing toward a bullish momentum for bitcoin.

Immediately after Tether and Bitfinex's general counsel, Stuart Hoegner, disclosed in an affidavit submitted to the Supreme Court of the State of New York, eToro CEO Yoni Assia suggested that the incident could serve as a catalyst for the near-term rally of bitcoin.

Tether investors buying bitcoin to either keep their funds in bitcoin or to sell for fiat could have fueled the momentum of the asset.

Several prominent investors in the crypto space such as Vinny Lingham from Multicoin Capital have said that bitcoin surpassing the $6,200 to $6,400 range would officially signal the beginning of a new bull market.

Alex Krüger, a global markets analyst, noted that the 2018 bear trend came to an end when bitcoin surpassed $4,200 and that a new bull market is likely to start as BTC surpasses $6,400.

Some positive fundamental indicators that could restore the confidence of investors as bitcoin approaches its block reward halving is the rise of bitcoin's transaction volume, hash rate and trading volume.