Another day, another all-time high for the leading cryptocurrency.
- Bitcoin (BTC (+1.01%)) on Sunday set a new high water mark of $58,332.36, bringing the leading cryptocurrency’s year-to-date gain to over 100% less than two months into the year. For all of 2020, BTC rose 305%.
- At press time, the price settled back to $58,148.31, up 2.3% over the last 24 hours, and cutting the YTD gain to over 98%.
- Some are attributing the eye-popping rise to tremendous demand from buyers looking to hedge against inflation as governments keep spending and central banks keep printing money in a desperate effort to keep their economies afloat during the pandemic. Yet despite all the printing and spending of fiat money, the key indicators aren’t reflecting inflation at all
- “Through the insatiable buy-side pressure from exchange-traded fund (ETF) issuers, closed-end funds and large public corporations adding bitcoin to their positions, demand is massively outstripping supply,” said John Willock, chief executive at digital asset exchange Blocktane.
- The current ramp-up in the price of BTC was ignited earlier this month by Tesla, when the electric-automobile manufacturer said it had purchased $1.5 billion of the cryptocurrency for its treasury. This sparked a round of playing “who’s next?” in terms of investing treasury funds in BTC and the resulting hype helped focus the attention of main street investors on the sector overall.
- Some have speculated that the series of all-time highs reached over the last several days is at least partly due to BTC-hungry MicroStrategy, which on Friday morning said it had raised more than $1 billion of debt in order to fund even more purchases of the cryptocurrency. The price of BTC has risen more than $5,000 since the company’s announcement.