Bitcoin, the world’s biggest cryptocurrency is picking up momentum once again, surpassing $60,000 for the first time amid the expectation that the digital coin will achieve wider adoption.
According to the digital currency exchange Coinbase, the cryptocurrency has touched $60,415.34 last day, recovering from a huge dip at the end of February that followed a previous high record that month.
“Bitcoin’s resilience is proving to be the stuff of legend. Every correction is an opportunity to reset and restart the move upwards,” said Antoni Trenchev, managing partner and co-founder of Nexo, a crypto lender in London.
Bitcoin is up about 1,000 percent in the past year amid signs of increasing institutional interest as well as speculative demand. Its value surpassed $1trillion last week for the second time in 2021.
Wider adoption by larger institutional investors and firms and speculative demand is the key reasons for Bitcoin’s current rally. The electric car company Tesla’s $1.5 billion investment in the digital coin and Chief Executive Officer Elon Musk’s high endorsement for the cryptocurrency on social media gave it a great push.
Mastercard had earlier said it will open up its network for cryptocurrencies. The online payments system PayPal and investment banking company BNY Mellon has also made some moves into the space. Billionaire investor Mike Novogratz, who runs Galaxy Digital Holdings, has said that Bitcoin could reach $100,000 by the end of the year.
“The announcement from the White House is very significant for risk assets in general, and crypto-assets specifically,” said Simon Peters, an analyst at multi-asset investment platform eToro, adding that the “floodgates” are now open in terms of new liquidity.
The crypto advocates support Bitcoin as a store of value equivalent to the gold that can be used as a hedge against inflation and a weaker dollar. Meanwhile, the skeptics argue that the rally is a giant stimulus-fueled bubble on track to burst like when it skyrocketed to almost $20,000 in late 2017 before losing about 80 percent of its value the next year.