Bitcoin crossed the $57,000 mark for the first time since November 2021, as the world's largest cryptocurrency was buoyed by investor demand through exchange-traded funds and buying by MicroStrategy. The cryptocurrency has rebounded nearly 27% in the calendar year 2024, driven by spurt in activities in the spot bitcoin exchange traded funds (ETFs), which started in the United States in January 2024. In the past six months, Bitcoin has risen 115%, while it rebounded 140% in the last one year.
At the time of reporting, the price of Bitcoin was around $56,500, adding $100 billion to its market capitalisation by rallying over 10% in the past 24 hours.
Tracking a rally in bitcoin, other cryptos also witnessed strong demand, with Ether trading at $3,235, after hitting a high of $3,273 in the past 24 hours.
Ether, the second largest cryptocurrency, has outperformed Bitcoin on a year-to-date (YTD) basis with a 37% rally as compared to a 27% gain in the flagship digital currency. The recent surge in Ether price can be attributed to low levels of ETH held on exchanges as well as the anticipated Dencun upgrade.
Shivam Thakral, CEO of BuyUcoin, says that Bitcoin has finally broken out days after consolidating under its resistance. “This rally could have been fueled by institutional buying who expected this move in foresight. MicroStrategy bought 3,000 BTC yesterday just before Bitcoin broke the resistance. Ethereum has also broken $3,200 days after breaching $3,000, which could set a new ATH after Bitcoin cools down.”
MicroStrategy, the largest corporate owner of Bitcoin, has purchased an additional 3,000 tokens for $155 million, raising the company's total holdings up to 193,000 coins. “MicroStrategy has acquired an additional 3,000 BTC for $155 million at an average price of $51,813 per bitcoin. As of February 25, MicroStrategy now holds 193,000 $BTC acquired for $6.09 billion at an average price of $31,544 per bitcoin,” tweeted Executive Chairman Michael Saylor.
Ryan Lee, Chief Analyst at Bitget Research, says that it is interesting to note that assets in the traditional financial markets such as S&P 500 are hitting a new all-time high. The crypto markets have a general correlation with the broader economy as adoption has increased since 2020.
“On Feb 26, Bitcoin ETF's in the U.S. surpassed its all-time high as the trading volume hit $2.4 billion with investors anticipating strong growth post halving in May. In the past week, crypto investment products have witnessed inflows around $600 million from institutional investors alone.”
“The overall growth of the global economy and anticipation of the upcoming halving may push Bitcoin and the crypto market to new high ranges. Nevertheless, the market indices project extreme fear and greed flagging the possibilities of a pullback," says Lee.
Zakhil Suresh, CEO of BitSave, a crypto investment platform, says, “Bitcoin breached $57k levels for the first time since November 2021. The world's largest crypto asset is now up more than 200% from its previous bottom levels in November 2022 post the FTX fiasco.”
According to BitSave’s CEO, the rally has been primarily triggered by institutional allocation and the increased retail participation in the last few months due to Bitcoin Spot ETF applications in the U.S. and upcoming Bitcoin halving. “Even though prices started dropping immediately after 11 spot ETFs were approved by the SEC last month, owing to profit-booking by early investors, Bitcoin found support below $40k which also coincided with 100 day moving average,” he says.
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