Bitcoin surges to record high above $72,000 amidst growing investor confidence
Factors contributing to the surge include investments in new spot bitcoin exchange-traded funds and expectations of a Federal Reserve interest rate cut.
Bitcoin reached a new all-time high, surpassing $72,000, with a 4.4% increase to $72,649. The surge is attributed to significant investment in new spot bitcoin exchange-traded funds and the Federal Reserve’s expectations of an interest rate cut.
Bitfinex analysts noted the strength and resilience of bitcoin, emphasising the milestone and ongoing market confidence. Flows into the top 10 US spot bitcoin exchange-traded funds slowed but still reached nearly $2 billion in the week to 8 March, according to LSEG data.
Bitcoin’s supply is set to decrease in April during the ‘halving’ event, which occurs every four years, impacting the rate of new supply and miner rewards.
Despite Bitcoin’s volatility, the surge indicates confidence in the market.
The UK’s Financial Conduct Authority (FCA) paved the way for digital asset trading products, allowing recognised investment exchanges to launch crypto-backed exchange-traded notes (ETNs) for professional investors. The FCA cautioned about potential harm to retail investors from crypto ETNs.
Asset managers currently hold the largest bullish position on bitcoin futures, reaching $5.5 billion in the week to 5 March. Meanwhile, Ethereum rose to $4,062.07, near a two-year high, driven by speculation that US regulators might approve spot ether ETFs in 2024. Coinbase shares rose 2.8% in the crypto stock market, while crypto miners Riot Platforms and Marathon Digital fell 2.2% and 6.1%, respectively.
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