The virtual unit struck $72 385 as dealers also eyed an upcoming industry event that traditionally boosts its price by restricting supply. Photo: Reuters
Bitcoin raced to an all-time peak above $72 000 (R1.3 million) yesterday as the world's most popular cryptocurrency won further support on greater trading accessibility and dollar weakness.
The virtual unit struck $72 385 as dealers also eyed an upcoming industry event that traditionally boosts its price by restricting supply.
Yesterday’s spurt extended last week’s record-breaking run when the currency bulldozed its way past the previous November 2021 pinnacle of $68 991.
Bitcoin won further support yesterday after Britain’s Financial Conduct Authority watchdog said it would join US regulators by allowing the creation of crypto-related securities.
US authorities earlier this year gave the green light to exchange-traded funds (ETFs) pegged to bitcoin’s spot price, making it easier for mainstream investors to add the unit to their portfolio.
Crypto ‘going mainstream’
“This (FCA statement) suggests that crypto is going mainstream, and not just bitcoin but also other established coins,” said XTB analyst Kathleen Brooks.
“We know that the demand is there, and this comes on the back of $10 billion of inflows into bitcoin ETFs in the US.”
ETFs are widely regarded by commentators as proof of burgeoning crypto interest from institutional investors, further buoying investor enthusiasm.
Bitcoin is created – or “mined” – as a reward when powerful computers solve complex problems to validate transactions made on the blockchain.
But the reward given to bitcoin “miners” – those who contribute to the creation of the blockchain by validating transactions – is about to be divided by two.
Next month’s so-called “halving” has lent strong support to the unit’s price in recent days and weeks by tightening supplies.
“Bitcoin has surged to a fresh all-time high, boosted by strong ETF inflows and ahead of the April halving event,” said City Index analyst Fiona Cincotta.
“The crypto market has skyrocketed 350% from its 2022 low and shows little sign of stopping after the doors have been opened to institutional investors and as retail investors experience FOMO,” she said in reference to a “fear of missing out”.
Cincotta predicted that $100 000 could become “the next natural target” but sounded a note of caution.
“Bitcoin is extremely volatile and could drop just as quickly as it has risen,” she warned.
AFP