The price of Bitcoin climbed to a record high of about $69,000 Tuesday morning, continuing a months-long rally and helping fuel a surge in other cryptocurrencies as it keeps ticking upward from its 2023 doldrums.
The price of Bitcoin hit a record high Tuesday morning, and has now skyrocketed nearly 54% on the year.
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Key Takeaways
- Bitcoin briefly crossed $69,000 Tuesday morning before falling back to around $65,500 according to CoinDesk, breaking its previous record of $68,990, which it briefly touched in November 2021.
- Bitcoin rose nearly 3% on the day at its peak shortly after 10 a.m., though its mid-morning decline put it down nearly 3% on the day.
- The cryptocurrency’s momentum follows a drive in spot bitcoin exchange-traded funds, better known as ETFs, which the federal Securities and Exchange Commission approved in January, allowing investors to enter the crypto arena in a less risky manner and attracting nearly $8 billion in net inflows on legacy firms including BlackRock and Fidelity in under two months, Bloomberg reported.
Key Background
Bitcoin’s rise marks a major rebound from its 2022 and 2023 lows, including in November 2022 when prices hovered just over $16,000 in the wake of crypto exchange FTX’s epic collapse. Persistent recession fears and near-record inflation also contributed to Bitcoin’s decline over the past two years. One pessimistic inflation report in September 2022 prompted Bitcoin to plummet nearly 10%, as investors pulled back their assets over fears high inflation and repeated interest rate hikes by the Federal Reserve could coincide with a so-called crypto winter. Bitcoin’s resurgence began late last year, rising to roughly $44,000 by New Year’s Day as investors anticipated federal regulators to approve spot ETFs, and as the Federal Reserve hinted at upcoming interest rate cuts.
Contra
Despite its recent gains, Bitcoin has drawn a mixed reception from analysts and economists since its debut over a decade ago. Last December, JPMorgan Chase CEO Jamie Dimon said he is “deeply opposed” to Bitcoin and cryptocurrency generally at a high-profile Senate hearing, suggesting crypto exists to fund illegal business. Dimon urged lawmakers at that hearing to “close” the industry, arguing its “true use” is for “criminals, drug traffickers” and people trying to dodge taxes—Dimon’s opposition to crypto seemed to taper off one month later, when the CEO called Bitcoin a “pet rock” that “does nothing” in an interview with CNBC’s “Squawk Box.” Sen. Elizabeth Warren, D-Mass., has also targeted crypto, including in a December letter to Coinbase, Coin Center and the Blockchain Association, demanding answers on those organizations’ use of a “revolving door to undermine efforts to rein in crypto’s use in terrorist financing.”
This article was first published on forbes.com and all figures are in USD.
