Bitcoin’s (BTC) bullish surge in January has helped the Nasdaq Crypto Index to register its third-highest monthly gain, with a 38% surge. The cryptocurrency market started the year bullish, defying major bearish market outlooks. Bitcoin and a number of altcoins touched new multi-month highs as inflation cooled off.
The Nasdaq Crypto Index (NCI) recorded its third-biggest monthly gain since its inception in February 2021. The crypto asset index was launched by Brazilian asset manager Hashdex in partnership with the Nasdaq stock exchange. The index consists of eight cryptocurrencies: Bitcoin, Ether (ETH), Bitcoin Cash (BCH), Litecoin (LTC), Chainlink (LINK), and Stellar (XLM), among a few others.
BTC has the highest weight in the index (69.8%), followed by ETH (27.08%). The other altcoins have a weight of less than 1%. Thus, the subsequent rise of BTC and ETH, which have surged over 35% in the past month, is also reflected in the index. The index weight refers to the share of stocks invested in a particular digital asset.
With a prolonged crypto winter throughout 2022, Bitcoin ended the year at around $16,500, with most altcoins also testing their yearly lows. Many market pundits had warned that the bearish sentiment might continue into the new year owing to the FTX saga unfolding daily. However, the crypto market showed resilience and started the year on a bullish note, registering a double-digit gain for the past month.
On Feb. 1, the Federal Open Market Committee press briefing announced an interest rate hike of 25 basis points. The United States Federal Reserve Chair, Jerome Powell, suggested that inflation has started to cool off in the world’s largest economy. The Fed raise worked wonders for the crypto market, with BTC briefly touching $24,000 and the crypto market cap rising by 4%.