The Bitcoin price reached the $60,000 mark today, marking its highest value in over two years. The surge comes amid a significant influx of capital into new U.S. spot Bitcoin exchange-traded products, propelling a staggering 42% price rally throughout February, marking its most substantial monthly gain since December 2020.
Currently, Bitcoin’s price sits at $60,338 at the time of writing, up by 6% and hitting its highest point since November 2021, when it flirted with a record just shy of $70,000. Moreover, Bitcoin is on track for its most significant week-on-week gain in a year, rising by 18.5% since 21 February.
Traders’ renewed interest in Bitcoin is largely attributed to the upcoming halving event scheduled for April—a process designed to decrease the release rate of the cryptocurrency. Additionally, speculation surrounding potential rate cuts by the Federal Reserve this year has fuelled investor appetite for higher-yielding and more volatile assets.
“Bitcoin’s surge is fuelled by consistent inflows into the new spot ETFs and anticipation surrounding April’s halving event and the potential Fed interest rate cuts in June,” noted Ben Laidler, global markets strategist at retail investment platform eToro.
The collective value of all circulating Bitcoins surpassed $2 trillion this month for the first time in two years, as reported by crypto platform CoinGecko. Remarkably, the token’s price has doubled in just four months.
Interest in major Bitcoin exchange-traded funds (ETFs) has surged notably this week, with significant volumes traded. The leading ETFs managed by Grayscale, Fidelity, and BlackRock have experienced a substantial uptick in trading volumes, with approximately 110 million shares changing hands on Monday and Tuesday alone.
“We’re witnessing the ETF effect ahead of schedule. Inflows into these ETFs escalated rapidly last week and have been sustained, indicating advisors’ swift action in promoting the ETFs to clients,” explained Joseph Edwards, head of research at Enigma Securities.
Data from LSEG revealed that flows into the top 10 largest spot Bitcoin ETFs totalled $420 million on Tuesday alone, marking the highest inflow in almost two weeks.
Antoni Trenchev, cofounder of Nexo crypto exchange, highlighted the bullish sentiment, stating, “If $60,000 doesn’t whet the appetite, consider that 70% of Bitcoin supply has remained unmoved for a year, and the little that’s left is being hoovered up by the likes of BlackRock and Fidelity, just as rewards for miners are about to be slashed in half. The stars are aligning for Bitcoin.”
In addition to institutional interest, notable corporate entities have also joined the Bitcoin bandwagon. MicroStrategy, a software firm, recently disclosed its purchase of about 3,000 Bitcoins for $155 million. Similarly, social media platform Reddit revealed in a regulatory filing its acquisition of small amounts of Bitcoin and Ether.
Meanwhile, Ethereum, the world’s second-largest cryptocurrency, surged 3.2% to $3,353, hitting another two-year high. Ethereum’s price has risen by 47% in February, marking its most substantial monthly gain since a 70% rally in July 2022.
Investors are eagerly awaiting U.S. regulators’ decision on ETF applications based on spot Ether, which could further boost its value.
Despite the remarkable surge, some analysts note a relatively measured environment, with Ether’s gains against the field indicating a steadier ascent. However, there’s still a hint of FOMO (fear of missing out) in the current market sentiment, as observed by Enigma Securities’ Edwards.
Stay informed with our Bi-Weekly Pulse for the latest crypto and blockchain news.
Get access to the week’s most interesting reads, stats and find out about the most recent trends in the cryptocurrency market.
