Bitcoin Price Hits All-Time High: What Drove the Surge?
Bitcoin has reached a new all-time high, soaring to $72,242.51. After dropping to $63.80, the price of BTC has defied expectations by rising 13% within six days. The bulls are celebrating and optimistic that Bitcoin will hit $80,000 before the halving. So, what factors drove Bitcoinโs price to its peak?
Market Performance of Bitcoin Price
Currently trading at $71,947, Bitcoin has experienced a growth of 4.64% in the past day. Although slightly below its all-time high of $72,850.71, BTC price has seen a significant increase since its launch in 2009, reaching a staggering 116363188.87%. The volume has also grown by 76.31% in the past 24 hours, reaching $64.64 billion. With these developments, Bitcoinโs market cap stands at $1.42 trillion, making it the top cryptocurrency on CoinMarketCap. Furthermore, Bitcoin has surpassed silver to become the eighth largest asset based on market capitalization according to Companies Market Cap.
Top Reasons Why Bitcoin Price is Rising
1. London Stock Exchange Embraces Cryptocurrency
The London Stock Exchange (LSE) is planning to allow the submission of applications for Bitcoin and Ethereum Exchange-Traded Notes (ETNs) in the second quarter of this year. This move signifies mainstream financial marketsโ recognition of cryptocurrencies as legitimate assets. The addition of crypto ETNs to a prestigious stock exchange demonstrates increasing institutional interest in digital assets and is expected to attract new investors to the crypto market.
2. Increasing Institutional Interest
The introduction of Bitcoin Exchange-Traded Funds (ETFs) in the US has contributed to the surge in Bitcoinโs price. Since their launch on January 11, these ETFs have gained significant traction, attracting more than $7.5 billion in investments. Family offices, venture capital funds, and RIAs have shown interest in these ETFs. Bitwise, a leading provider of index and beta cryptoasset funds, is currently in talks with major organizations managing trillions of dollars worth of assets, wirehouses, and institutional consultants.
The growing confidence in Bitcoin ETFs indicates their establishment as a recognized investment option in the mainstream financial sector. As a result, significant capital inflows are expected from these entities in the second quarter of 2024. This influx of capital from prominent wirehouses, institutional consultants, and large companies bodes well for the future of Bitcoin.
3. Short-sellers on Edge
A prediction made by Bitcoin Munger, a crypto portfolio manager, has come true. He stated that Bitcoinโs price would skyrocket due to short sellers being caught off guard as the price hits $70,000. When short sellers face difficulties, they are forced to buy back Bitcoin quickly to minimize their losses. This rush to buy can drive up the price even further. With short sellers potentially facing a squeeze at the $70,000 mark, it was expected that Bitcoin would reach new record highs.
4. Spot Bitcoin ETF Increased Inflows
Trading volumes for spot Bitcoin ETF vehicles were robust when the U.S. stock markets opened on March 11. In the first half hour alone, BlackRockโs Bitcoin ETF saw $500 million in trades. Fidelityโs spot Bitcoin ETF also experienced trading volume exceeding $217 million during the same timeframe.
According to CoinShares data, institutional investors invested $10.3 billion into cryptocurrency in 2024. In 2021, crypto products saw a record high of $10.6 billion in inflows for the entire year. Last week alone, crypto investment products received a record-breaking influx of over $2.7 billion. Additionally, more money flowed into short bitcoin positions, with an additional $11 million added last week.
Out of the total $11.3 billion invested in cryptocurrency assets in 2024, more than $9.9 billion has been allocated specifically to Bitcoin. Bitcoinโs total assets under management (AUM) surpass that of other digital assets, standing at $71.8 billion.
Conclusion
The recent surge in Bitcoinโs price to an all-time high highlights its growing prominence and resilience in the financial landscape. This surge signals continued optimism among investors. Analysts and experts predict further increases in Bitcoinโs value, with projections ranging from $80,000 to $130,000-$180,000 in the future. The rise of ETFs is also expected to contribute to Bitcoinโs upward trajectory.
With these developments, itโs an exciting time for Bitcoin enthusiasts and investors alike.
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