In a significant milestone for the cryptocurrency market, the Bitcoin market cap has surged past the $1 trillion mark, marking its highest point since November 2021. This surge comes as inflows to U.S. spot Bitcoin exchange-traded funds (ETFs) continue to bolster cryptocurrency prices, reflecting a renewed investor interest in digital assets.
Bitcoin’s price soared to a peak of $52,079 on Wednesday, hitting its highest level in 25 months. At its current rate, it stands at $51,690, translating the Bitcoin market capitalisation to over $1.013 trillion, as reported by Coingecko, a leading price platform for cryptocurrencies. Notably, Bitcoin has witnessed a remarkable 22% surge since the beginning of February, poised to record its most substantial monthly increase since October.
Analysts attribute much of this upward momentum to the robust inflows into newly listed U.S. ETFs. In the week leading up to Wednesday, capital flows into the 11 U.S. spot Bitcoin ETFs surged to $1.64 billion, according to data from LSEG Lipper. Over the past five trading sessions alone, these products have seen inflows totalling $409 million. Analysts at B2C2, a crypto liquidity provider, suggest that such a pace could potentially sustain further price rises for Bitcoin, as inflows often follow price movements in the cryptocurrency market.
In a related development, bankrupt crypto lender Genesis Global Capital has been granted permission by a U.S. court to sell approximately $1.6 billion worth of shares in Grayscale Investments’ spot Bitcoin ETF. This move is part of Genesis Global Capital’s efforts to settle debts owed to creditors, underscoring the growing integration of traditional financial institutions into the cryptocurrency ecosystem.
While the current Bitcoin market cap surpasses $1 trillion, its previous peak reached $1.28 trillion in November 2021. Notably, Bitcoin investments constitute more than half of the $2.01 trillion total market capitalisation of the entire cryptocurrency market, which includes assets like ether and other digital coins.
The surge in Bitcoin’s value has also sparked significant gains in shares of U.S.-listed cryptocurrency companies. Notably, exchange Coinbase saw a notable 13.5% increase in its shares, while mining firms Riot Platforms and CleanSpark experienced gains of 12.2% and 11.3%, respectively. This highlights the broader bullish sentiment surrounding cryptocurrencies, with investors increasingly turning to related stocks for exposure to the surging digital asset market.
Bitcon’s journey to surpassing the $1 trillion mark has been marked by significant fluctuations. After reaching an all-time high of $69,000 in November 2021, Bitcoin faced challenges throughout 2022 and the early part of 2023. Factors such as monetary tightening by global central banks and high-profile failures at crypto companies, including FTX exchange, weighed on its performance. However, recent months have seen a resurgence in optimism, driven by hopes of a soft economic landing and the introduction of spot Bitcoin ETFs.
These ETFs have been heralded as a game-changer for the cryptocurrency industry, as they provide investors with a convenient avenue to gain exposur to Bitcoin without directly owning the asset.
Meanwhile, Ethereum’s native token, ether, which powers the Ethereum network, has also witnessed a surge as reported yesterday. Ether was last up 4.9% at $2,762, marking its highest level since May 2022. As noted, Ethereum’s upward trajectory is underscored by a surge in funding rates. The overall picture is one of overwhelming bullish sentiment, suggesting that Ethereum could soon make a dash for the coveted $3,000 mark.
The overall cryptocurrency market continues to exhibit strength and resilience, with Bitcoin leading the charge towards new milestones amid growing investor interest and institutional adoption.
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