Bitcoin has shattered its previous record, reaching an all-time high above $69,000 for the first time in over two years. The cryptocurrency‘s price peaked at $69,210 on Tuesday morning. This surge is attributed to the ongoing excitement surrounding bitcoin Exchange-Traded Funds (ETFs) and the impending halving event.
In response to this achievement, Alex Thorn, head of research at Galaxy Digital, expressed confidence in Bitcoin’s enduring nature, stating, “Bitcoin reclaiming its all-time high yet again shows it is never going away.” He highlighted the cryptocurrency’s resilience, having experienced multiple significant drawdowns over its 15 years of existence.
Clara Medalie, research director at crypto data provider Kaiko, emphasized the importance of this new record, describing it as “an important psychological milestone.” She noted that it demonstrates crypto’s remarkable ability to bounce back and persevere despite challenges faced by the industry.
Thorn further explained the growing value of Bitcoin, stating, “Bitcoin becomes more useful as it grows more valuable.” He highlighted the cryptocurrency’s decreasing volatility over time, allowing for larger allocations and supporting larger position sizes in the market.
Since the beginning of February, key themes driving the surge in Bitcoin’s price include the introduction of U.S. spot Bitcoin ETFs and the tightening Bitcoin supply leading up to the late April halving event. This scarcity event is designed to create increased demand for the asset, contributing to Bitcoin’s upward trend, which accelerated this week.
The record-breaking moment is particularly significant for an industry that faced reputational and regulatory challenges just two years ago, including the pressures on crypto lenders and the collapse of the FTX crypto exchange. Bitcoin has since been on a mission to establish its legitimacy.
John Todaro, an analyst at Needham, sees this milestone as a potential catalyst for a new wave of retail investors entering the crypto market. He stated,
“Retail interest is oftentimes momentum-driven, and all-time high levels are a pivotal momentum driver for even more investment.”
Additionally, Todaro noted the possibility of increased capital flows into alternative cryptocurrencies (altcoins) that may appear comparatively cheaper. While Bitcoin’s recent success is evident, some caution is advised for investors. Ed Tolson, CEO and founder of the crypto hedge fund Kbit, warned of a potential correction in the market, suggesting a careful approach. Tolson stated,
“The market is positioned for a steep correction, possibly between 10% and 20%,”
CNBC
