On Tuesday, Bitcoin surpassed its previous all-time high of $69,000, reaching a new milestone and pushing its market capitalization above $1.35 trillion. This surge is attributed, in part, to the launch of several U.S. Bitcoin spot ETFs in January, which opened up investment opportunities for institutional buyers.
The rally began alongside the opening of the U.S. stock market, highlighting a growing trend as ETFs play a larger role in Bitcoin’s daily trading volume. However, despite reaching a new peak, Bitcoin has since dropped back to around $65,000 due to a significant selling event. This selloff triggered over $670 million in liquidations across the cryptocurrency market, impacting both long and short positions.
While this brief price correction may seem concerning, some experts like Vijay Boyapati, author of “The Bullish Case for Bitcoin,” believe it’s a common and historically observed phenomenon following new all-time highs. He suggests that the psychological barrier of surpassing $69,000 has been broken, potentially paving the way for further price discovery in the future.
It’s important to note that Bitcoin’s halving event, which cuts the rate of new coin creation in half, is not expected to occur until April 2024. This recent surge breaks the historical trend of Bitcoin reaching new highs only after halving events, suggesting a shift in market dynamics.
