Bitcoin blew through another landmark a few days ago, soaring through the $50,000 price point for the first time. Investors worldwide continue to be captivated by the blistering upward price surge in the world’s largest cryptocurrency.
This last week Bitcoin momentarily hit $58,330 before dipping down below $55K. So far this year Bitcoin is up roughly 73% and the market cap of the asset has broken through the trillion-dollar barrier. A competitor crypto, Ether, is up around 140% year-to-date.
After finishing last year with a 170% fourth-quarter rise to around $29,000, the Bitcoin token soared again during the first week of 2021 to $40,000. Then taking a modest breather Bitcoin took just another six weeks to breach the $50K threshold, assisted in part by endorsements from Paul Tudor Jones, Stan Druckenmiller, and Elon Musk. Bitcoin has certainly come long way in the last few months and also from its humble beginnings more than a decade ago when it traded for a mere few cents.
As many are aware Bitcoin was released in 2009 by a mysterious creator named, Satoshi Nakamoto. Since the initial release Bitcoin has evolved into a valued alternative investment asset for many investors.
Three years ago, in 2017 Bitcoin hit its then largest trading peak of $19,783. By the end of the year 2020, we saw Bitcoin climbing well above its 2017 peak to nearly $29,000. With the onset of the pandemic early last year Bitcoin tumbled as low as the $5,400 level with the worldwide lockdown.
However, Bitcoin rallied back later in the year with a steady consistent climb due in part to investors taking a considerable interest in trading Bitcoin for long term investment purposes. Now it appears some companies, industrialists, and even traditional investors are finding a safe and profitable heaven in Bitcoin. Like gold and other assets, Bitcoin has become an alternative investment asset. That being said, most public companies are not jumping on the Bitcoin bandwagon quite yet, and likely will not until an increased level of regulation surrounds the investment opportunity.
Philip Gradwell, the chief economist at Chainanalysis says that today Bitcoin is receiving a very different type of investor, one who is investing steadier amounts over time and also considering a longer-term hold.
In the interim, Bitcoin is serving as an antidote to a partially dysfunctional economy and market. The excitement around Bitcoin is fueled in part due to modest traction created by increased regulatory attention and mainstream financial companies who are investigating the asset for potential investment.
Meltem Demirors, the Chief Strategy Officer at Coinshares says that Bitcoin is different from other cryptocurrencies. To quote her, “Bitcoin’s fundamentally different from every other cryptocurrency. Bitcoin is not like anything else. The way that Bitcoin was created, the long distribution cycle, the fact that it’s been in the market for 12 years, there’s no CEO of Bitcoin you can call. You know, if you wanted to file a lawsuit against Bitcoin, you couldn’t even begin to do that because there is no one entity that controls Bitcoin.”
So, many are wondering will Bitcoin continue to surge in value? With massive U.S. stimulus likely on the way again some investors feel that the stored value of the alternative asset will continue its climb as the value of the global U.S. currency wanes.