Bitcoin surpasses $70K mark for the first time amid market volatility

For the first time in history, the price of Bitcoin surpassed $70,000 on Friday, setting a new record. According to Coin Metrics, the digital currency last increased by around 2% to $69,304.84 but it once escalated to as high as $70,170.00, beating the previous high from Tuesday. Bitcoin is projected to conclude the week with a 10% increase.

The rise began when the U.S. stock market started trading. The newly introduced spot bitcoin exchange-traded funds in the U.S. appear to be influencing significant shifts in cryptocurrency during traditional stock trading hours.

Investors assessing the February jobs report may have contributed to the early rise, with expectations that the higher unemployment rate and less robust employment growth from December and January could prompt the Federal Reserve to start reducing interest rates later this year.

However, the week has seen particular volatility in cryptocurrency trading. Bitcoin hit a new all-time high on Tuesday – the first in over two years – before promptly dropping by as much as 10%. This also negatively affected other cryptocurrencies and crypto stocks, although many of these losses were recouped the following day. The Bitcoin historical volatility index is at its highest in nearly a year, TradingView reports.

Co-founder of crypto exchange Nexo, Antoni Trenchev, advises caution when approaching previous highs, stating, “The Bitcoin dam doesn’t tend to burst at the first time of asking.” He described Tuesday’s sharp Bitcoin sell-off as “healthy, necessary, and a prelude to further gains,” adding that the volatility is a defining aspect of Bitcoin bull markets. He also warned of the possibility of sudden and significant drops of 10-20% in 2024.