The cryptocurrency market experienced a sharp rally this week following unconfirmed reports about potential government payouts to American households. Bitcoin climbed from $101,000 to $104,000 within hours. Dogecoin posted a brief 5% gain before momentum stalled.
Financial newsletters circulated claims that Americans earning under $100,000 annually could receive $2,000 payments linked to tariff revenues. The reports triggered immediate speculation among traders that recipients would allocate portions of these funds toward digital assets. Market participants responded swiftly to the possibility of retail cash inflows.
Trading data confirmed the surge in activity. Binance recorded Bitcoin spot volume jumping from $8.3 billion to $11.1 billion during the rally period. The price movement occurred without accompanying news from regulatory bodies or major institutional announcements. Funding rates across major cryptocurrencies turned negative for nearly twelve hours, indicating forced liquidations of short positions contributed to the upward momentum.
Billy Markus Offers Blunt Assessment
Billy Markus, who created Dogecoin in 2013, commented on the market reaction through social media. He stated the response aligned with expectations, noting that observers anticipate these funds will be “used stupidly.” His remarks reflected a common sentiment among cryptocurrency veterans regarding retail investor behaviour during stimulus-driven rallies.
Dogecoin’s 5% increase proved temporary. The meme coin remains 22% below its recent peak despite the rumour-fueled bounce. The broader market exhibited similar patterns, with initial enthusiasm followed by consolidation.
The connection between government stimulus and cryptocurrency purchases has historical precedent. Previous rounds of direct payments to households in 2020 and 2021 corresponded with notable increases in crypto trading activity. Exchange data from those periods showed measurable upticks in new account registrations and deposit volumes.
Rally Loses Steam Amid Range-Bound Trading
Bitcoin’s gains proved short-lived as the asset returned to familiar trading boundaries. The cryptocurrency continues moving within a $98,900 to $106,200 range. This represents a significant retreat from the late October high near $118,000.
Derivatives markets showed modest liquidation activity totalling $58 million. This figure falls well below thresholds typically associated with sustained trend reversals. Market analysts noted the absence of panic selling or aggressive position closures during the rally.
Stablecoin inflows to exchanges provided another indicator of limited conviction. These metrics increased just 0.7% for the week, suggesting traders did not rush to deploy additional capital despite the price movement. Stablecoin reserves on trading platforms typically surge ahead of major buying campaigns.
The tariff-linked payout proposal lacks official confirmation from government sources. No legislation has been introduced to authorize such payments. Treasury Department representatives have not addressed the circulating reports.
Source: https://coinpaper.com/12324/stimulus-rumours-drive-bitcoin-to-104-000-as-dogecoin-posts-brief-5-gain