Crypto market rally: Why are altcoins going up today? (October 5)

A crypto market rally is intensifying today, Oct. 5, as Bitcoin price jumped to a record high and the valuation of all coins hit $4.26 trillion. The Bitcoin price rally has led to more upside among other cryptocurrencies like Ethereum, Solana, and Stellar.

Crypto market rally boosted by Bitcoin surge

The first main reason why the crypto market rally is happening is that the Bitcoin price is in a strong surge and is sitting at its all-time high.

BTC price soared to a record high of over $125,000 for several reasons, including the robust ETF inflows and its safe-haven appeal rises among investors. 

Bitcoin has also been boosted by the ongoing supply and demand dynamics. BTC has a supply limit of about 21 million coins and is seeing robust demand from American institutional investors. 

It is common for altcoins like Ethereum, Solana, and XRP to jump whenever Bitcoin is in a strong rally.

Federal Reserve interest rate cuts

The other catalyst for the BTC and the crypto market is that the Federal Reserve has embraced a more dovish sentiment in the past few months. 

Jerome Powell and his committee decided to cut interest rates in the last meeting in September. It brought the benchmark rate to between 4.00% and 4.25%. Also, the bank hinted that it will cut interest rates in the coming meeting.

Odds that the bank will cut rates jumped last week after the government shutdown happened. The odds then increased after ADP published weak jobs numbers last week. This report showed that the economy lost over 36,000 jobs in September.

Another report by the Bureau of Labor Statistics (BLS) revealed that there are now more jobless people than there are vacancies.

Soaring Crypto Fear and Greed Index and Uptober rally

The crypto market is going up as investors embrace a risk-on sentiment. One of the signs for this is that the Crypto Fear and Greed Index has jumped to 58 and will likely hit the greed zone of 60 soon. It is common for cryptocurrencies to jump when investors are greedy. 

The greed sentiment is rising as investors predict that a Uptober rally will happen. Uptober refers to a situation where the crypto market experiences positive returns in September. 

Increasing ETF inflows and potential approvals

Meanwhile, the crypto market is thriving as investors focus on the ongoing ETF inflows. Data shows that Bitcoin ETFs added over $3.2 billion last week. Spot Ethereum ETFs added over $1 billion in assets and are now nearing their $15 billion milestone. 

At the same time, investors anticipate that the SEC will approve several spot ETFs like Solana and XRP in the coming weeks. 

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