Topline
Bitcoin, the world’s largest cryptocurrency, rose above the $ 30,000 mark on Saturday morning for the first time in its history and climbed as high as $ 33,000, before slipping back below $ 32,000 by the end of the afternoon. Saturday, as the digital asset continues an astonishing climb.
This photo shows the gold cryptocurrency Bitcoin commemorative coin with mobile phone … [+]
SOPA / LightRocket Images via Getty Images
Key facts
Bitcoin was trading at around $ 10,000 in early September 2020 and did not cross the $ 20,000 threshold until just three weeks ago, on December 16th.
Key critic:
“History has a warning for people who are buying at the new full-time rate,” said finance author Glen Goodman Forbes via email last month. “While I am optimistic about the long-term prospects for bitcoin, four years ago we had a very similar situation with bitcoin breaking new ground, but just two weeks later its price fell by more than a third . “
What to look for:
Nicholas Pelecanos, head of trading at cryptocurrency company NEM, has predicted that Bitcoin could rise to $ 50,000 by Valentine’s Day. In mid-December, Scott Minerd, chief investment officer of Guggenheim Investments, told Bloomberg that Bitcoin should “eventually climb to about $ 400,000.”
Key background information:
Other cryptocurrencies, such as ethereum and litecoin, have posted three-digit percentage point gains in 2020 as well. One of the key features in their bull run is increasing institutional investment in the digital currency from established companies. In November, British fund manager Ruffer Investment Management, which controls more than $ 27 billion in assets, bought about $ 745 million in Bitcoin. The previous month, Paypal said it would allow customers to buy, hold and sell cryptocurrency directly from their PayPal accounts. In December, Massachusetts Mutual Life Insurance Company purchased $ 100 million worth of cryptocurrency for their general investment account. “As we approach the end of what has been an iconic year for bitcoin, I can only see positive growth in 2021,” said CoinCorner bitcoin and cryptocurrency exchange chief executive Danny Scott Forbes last month. But, according to Fortune, Bitcoin has a long history of “volatility” and “most viewers expect some backing” of this “sooner or later” rally. The first major spike in the price of Bitcoin occurred in 2017, climbing to around $ 20,000 per bitcoin, but then losing over 80% of its value over the following 12 months.
Further reading:
Bitcoin Powers Through $ 30K, Will It Survive? (Forbes)
Is this why Bitcoin, Ethereum, Litecoin and other cryptocurrencies have suddenly fired higher? (Forbes)
Bitcoin Rises $ 33,000, Highest Ever (CNN)