Bitcoin Soars to $85,200 Amid Regulatory Optimism

Bitcoin has reached an eight-month high of $85,200 after experiencing a surge of up to 5%. This price increase comes as stronger ETF inflows and regulatory developments combine with an improvement in risk sentiment.

Naeem Aslam, chief investment officer at Zaye Capital Markets, attributed the recovery from last week's drop below $76,000 to 'stronger ETF inflows, regulatory developments and a sharp squeeze in bearish positions'. He noted that institutional demand is absorbing part of the pressure from higher interest rates.

The rally also comes ahead of a summit between US President Donald Trump and China’s Xi Jinping. Aslam said, 'A more constructive tone ahead of talks with China can improve general risk appetite across equities, technology and digital assets.'

However, the cryptocurrency fell last week after the Clarity Act was blocked in the Senate. The Clarity Act aims to create a clear regulatory framework for cryptos in the US.