Topline
Bitcoin is nearing its all-time high price, breaking $65,000 for the first time since 2021 on Monday. This puts bitcoin on the verge of completing its remarkable comeback.
Bitcoin is red-hot in 2024.
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Key Facts
Bitcoin surged around 6% to over $67,500 by early afternoon, reaching its highest level since Nov. 10, 2021.
Bitcoin is now approximately 2% away from its record high of nearly $69,000 achieved during the brief 2021 spike. This rally seems achievable as bitcoin has risen by over 50% in the last month.
The latest rally is largely driven by the positive sentiment from the spot bitcoin exchange-traded funds (ETFs) launched earlier in the year. These ETFs now hold almost $50 billion in assets and own 4% of all bitcoins, according to Bernstein data.
Optimism surrounding an upcoming “halving” event, along with a broader uptick in equity prices, has also contributed to the boost in bitcoin prices. The halving event is expected to slow the increased supply of bitcoins due to reduced miner incentives.
Surprising Fact
Bitcoin’s total market capitalization reached $1.29 trillion on Monday, according to CoinGecko, which is more than three times higher than its $320 billion market cap at the end of the crypto winter in 2022.
Contra
While bitcoin is nearing a record high valuation, the total market cap of the crypto market at $2.55 trillion falls short of the record high of over $3 trillion in late 2021. Bitcoin’s market share has increased from below 40% to about 50% over the past two years, with several other digital assets seeing a decline in value.
Key Background
The introduction of 11 spot bitcoin ETFs in January, managed by firms like BlackRock and GrayScale, has provided investors with a more accessible way to invest in bitcoin. Publicly-traded stocks closely linked to bitcoin have outperformed the market this year, with companies like Coinbase, Marathon Digital, and MicroStrategy hitting multiyear highs.
Further Reading