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Bitcoin reaches all-time high in crypto’s ‘validating moment’

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Bitcoin surged to $66,976, making its gains for the year nearly 130%.

New Delhi: Bitcoin topped $66,000 for the first time in the wake of the successful launch of the inaugural exchange-traded fund for US investors, as optimism grew for more mainstream acceptance.

While the historically volatile digital currency has spent recent days hovering in a narrow range as it reached its previous April high, the vault behind the threshold happened much faster: just after stock exchanges opened. The price rose by more than a thousand dollars in a minute. US big moves linked to key chart levels have been a common occurrence in the history of cryptocurrency trading for a little over a decade.

“It’s a valid moment,” said Jesse Proudman, co-founder and CEO of crypto advisory firm Makra. “It is no longer a question of whether this asset class exists – I think it is a truly meaningful mark in the history of the broader digital-asset class.”

Demand for the ProShares bitcoin strategy ETF continued to rise, with more than 29 million shares changing hands on Wednesday, or more than during the fund’s nearly record-breaking debut. This equates to over $1.2 billion in volume. The first bitcoin-linked exchange-traded fund listed in the US launched on Tuesday as the second most traded fund on record.

Bitcoin has climbed to its latest high above expectations of pandemic-era liquidity, speculative bets and widespread adoption by institutional investors. The ride was shaky: the token fell below $30,000 in June amid criticism of its energy consumption and China’s cryptocurrency crackdown. It then began to recover partly as the crypto sector adjusted to wider areas of China.

Amidst all the price frenzy, many quarters of the Wall Street establishment remain deeply skeptical about bitcoin’s role in finance. Securities regulators are stepping up their investigation into the cryptocurrency, with the US government effectively blocking a bitcoin lending program at Coinbase Global Inc. Critics have also cast doubt on claims that the asset’s scarcity makes it a long-term store of value and note the slow movement of a unit of exchange.

Hasthavamho

Bitcoin hit a high of $66,976 during New York trading hours, bringing its gains for the year to nearly 130%. The largest digital currency by market cap grew over 300% last year and 95% in 2019, up from 73% the previous year.

According to Athanasios Sorophagis at Bloomberg Intelligence, with a turnover of nearly $1 billion, the ProShares fund was only behind BlackRock Carbon Fund on its first day of trading Tuesday, with the latter ranking higher due to pre-seed investments.

“Clearly, the launch of the bitcoin futures ETF in the US has pushed prices up to these levels,” said Leah Wald, chief executive of Valkyrie Investments, applying for a futures-based fund. “Traders and investors probably see this as a precursor to the holy grail – a spot bitcoin ETF – and their optimism is pouring into the biggest cryptocurrency at a furious pace, with all of the FOMO money in business from all corners of the market. “

The biggest proponents of bitcoin support the controversial argument that the virtual currency is a store of wealth and a hedge against the most powerful threat from inflation in many years.

wall Street

There has also been excitement in some corners of Wall Street: Bank of New York Mellon Corp., Goldman Sachs Group Inc. and Morgan Stanley are among firms offering crypto-related services. Don Fitzpatrick, chief investment officer at Soros Fund Management LLC, said his firm owns some coins and that crypto “has gone mainstream.”

At the same time, there is still a long way to go. For example, Skybridge Capital founder Anthony Scaramucci said there is a “feeding frenzy” in crypto among about 10% of financial-services firms, but the vast majority are hesitant about the asset class.

In the past few years, a whole new crypto-economy has formed. Non-fungible tokens or NFTs – which allow holders of digital art and collectibles to track ownership – have hit the headlines.

decentralized finance

So is the decentralized finance – DeFi – ecosystem, which allows people to lend, borrow, trade and take insurance directly from each other, without the use of intermediaries such as banks.

Bitcoin’s record comes just in time for its birthday – the digital coin was born in Halloween 2008, coinciding with the publication of a research paper by someone known as Satoshi Nakamoto.

The paper was titled “Bitcoin: A Peer-to-Peer Electronic Cash System.” Its birth ignited a digital currency revolution, which led to the rise of over 12,000 other coins, according to data from CoinMarketCap.com. The total market cap of cryptocurrencies is over $2.5 trillion.

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