Bitcoin soars past $60,000, first time since November 2021

Bitcoin continued to enjoy a significant rally on Wednesday, exceeding $60,000 for the first time since November 2021. The leading cryptocurrency’s value was last observed to have increased by 7%, reaching $61,064.20, as per the data provided by Coin Metrics. At one point, it even touched $61,359.00. The digital coin is currently just shy of its highest-ever record of $68,982.20.

As the record peak is now quite visible, market motivation has increased toward seeing this level challenged again. Bitcoin’s price has surged almost 20% solely this week, following a minor pause in this year’s rally. Bitcoin’s value for 2024 has already appreciated more than 40%.

Antoni Trenchev, co-founder of crypto exchange Nexo, suggested that investors might see some resistance as bitcoin approaches $69,000. However, its breakthrough beyond $60,000 could stimulate interest among those who have not participated in this year’s rally, mainly retail investors. JPMorgan reported an upturn in their interest in crypto this month, following a break in January.

After the introduction of Exchange-Traded Funds (ETFs), which made the asset category more available to institutional investors, investors predict a record-breaking year for bitcoin. Additionally, the upcoming halving event in the Bitcoin network increases the potential for a substantial rally in the succeeding months.

Zach Pandl, the head of research at Grayscale Investments, stated how increasing demand for Bitcoin is confronting a progressively tightening supply. “The newly introduced U.S. spot bitcoin ETFs attracted an average of $195 million per calendar day in February,” he said. The Bitcoin network currently generates about 900 coins per day, equivalent to around $54 million worth of bitcoin, assuming a price of $60,000.

“With the forthcoming Bitcoin halving in April, issuance will drop by half … There is simply not enough Bitcoin to fulfill all the new demand, pushing prices higher due to natural supply/demand dynamics,” he added. The term “halving” refers to an event written into the Bitcoin code that cuts the bitcoin mining reward by half to control the supply, scheduled for next in April.

This positive movement significantly benefited bitcoin-related stocks. Shares of crypto exchange Coinbase increased over 5%, while Microstrategy, a known bitcoin proxy, saw an 8% rise. Popular mining companies, CleanSpark and Marathon Digital, also enjoyed a sizeable increase of over 4% each.