Bitcoin price hit an all-time high of $4,225.40 early Sunday before falling slightly back near $4,000 later in the day. Strong Japanese demand and geopolitical turmoil pushed the crypto leader to its new record.
A price of $4,09221 late in the day Sunday translated into a market capitalization of $67.542 billion, according to coinmarketcap.com. The crypto leader commanded 49.44% of total cryptomarket capitalization, with Ethereum holding 20.47%. Bitcoin gained 6.31% in the last 24-hour period.
Bitcoin has now quadrupled in 2017, jumping nearly 40 percent in August alone. Its market capitalization has gained more than $10 billion in the last week.
Japan Plays Heavily
Bitcoin trade in Japanese yen accounted for nearly 46 percent of global trade volume, up from about a third a day ago, according to CryptoCompare. U.S.-dollar/bitcoin trade accounted for about 25 percent. Trade in Chinese yuan and South Korean won accounted for about 12 percent each.
The surge gained speed in the last week, mirroring gold’s climb following a global stock and bonds selloff due to increasing worries about North Korea/U.S. tensions. Investors have moved more to bitcoin and other cryptocurrencies as a way to diversify investment risk.
“Bitcoin is benefitting from geopolitical tensions; trading in Japan and Korea has increased significantly over the last few months,” said Brian Kelly, a CNBC contributor and head of BKCM, which operates a digital asset strategy. He also attributed the gains to investors buying back bitcoin following the Aug. 1 split and increased attention from the Russian government.
Other analysts also noted increased investor interest after bitcoin successfully survived the Aug. 1 split into bitcoin and bitcoin cash.
This week, Fidelity launched a feature allowing customers to view their Coinbase bitcoin holdings. The currency also got a boost from Goldman Sachs, which in a report released this week said it is harder for institutional investors to ignore cryptocurrencies like bitcoin.
New Milestone Encouraging
“Bitcoin hitting $4,000 is another milestone in a long list of big moments the cryptocurrency has witnessed in recent weeks,” said Iqbal V. Gandham, the U.K. managing director of eToro, a social trading and investment network. “Following a fall to $1,800, it has come back strongly and relatively steadily. This is encouraging.”
“Furthermore, the ecosystem is also getting stronger,” Gandham said. “You now have more places to spend bitcoin, more regulators thinking about the right infrastructure, and more investors learning about the asset. Speculation is rightly moving away from price and focusing on use cases.”
Max Keiser, the host of RT’s Keiser report, predicted bitcoin’s price to hit $5,000 in 2017, considering the imminence of the Bitcoin Core development team’s scaling solution Segregated Witness (SegWit), rising demand from institutional investors and increasing adoption of bitcoin globally.
Throughout June and July, Keiser continuously laid out possible factors that could push bitcoin price over the $4,000 region and potentially to the $5,000 mark.
Other analysts including Tone Vays and Squeeze also noted that bitcoin’s price will likely sustain momentum throughout August and September.
Bitcoin’s future remains uncertain, however. It could split again in November, when Segregated Witness’ second phase is implemented.
Chris Burniske, author of the upcoming book, “Cryptoassets: The Innovative Investor’s Guide to Bitcoin and Beyond,” said a sharp pullback would not be surprising, given the rapid surge.
He stated on Twitter that bitcoin price upticks and Google searches historically have led to price corrections.
Featured image from Shutterstock.
Last modified: March 4, 2021 4:58 PM