Bitcoin on the rise – what is behind the record prices?
Bitcoin Breaks Price Records
Recently, Bitcoin broke the $71,000 level, setting new all-time highs for the second time in its history. This event brings about many changes in the cryptocurrency and investment market.
The Impact of Spot Bitcoin ETFs on Price Surge
The introduction of Spot Bitcoin ETFs in the USA has influenced a dynamic surge in Bitcoin, leading these funds to acquire a significant amount of cryptocurrency. Currently, Spot Bitcoin ETFs in the USA have acquired an additional 177,000 Bitcoins, joining the 621,000 held by Grayscale’s Bitcoin Trust. Together, these funds manage around 4% of all Bitcoins in circulation, showcasing a growing institutional interest in cryptocurrencies.
Upcoming Event – Bitcoin Halving
The upcoming Bitcoin halving event planned for April will result in a reduction in the daily issuance of new Bitcoins, potentially impacting the price. The halving will cut the block reward for miners from 12.5 to 6.25 Bitcoins per block. Miners are currently securing profits ahead of the impending halving, leading to an increase in outflows from mining wallets since the ETFs were launched.
Gold Price Surge
Not only Bitcoin is hitting record price surges. The price of gold has also risen above $2,187 per ounce, due to a weakening US dollar and Treasury bond yields. The rise in both Bitcoin and gold prices reflects investors’ quest for alternative assets in uncertain economic times.
Rise in Institutional Interest
The rise in both Bitcoin and gold prices reflects investors’ pursuit of alternative assets in uncertain economic times. Financial institutions are increasingly allocating funds to Bitcoin and other cryptocurrencies, leading to further price appreciation.
