- There’s no denying that Bitcoin (BTC) could be on its way to breaking its previous all-time high (ATH).
- Today, the largest cryptocurrency by market cap breached the $60,000 barrier, which is now just a few thousand dollars away from its historical peak.
As of 1:30 PM UTC, we just witnessed a breathtaking move for Bitcoin as it just proverbially crossed the Rubicon, which was the only obstacle holding it back toward its highest-ever valuation at $68,799 back on November 10, 2021.
As of this writing, Bitcoin is now worth $60,500 with over 6% gain in the 24-hour chart. This is the first time since November 2021 for the digital asset to reach such heights, which is the same month and year it went on an ATH. The pump also raises its market cap to $1.18 trillion to solidify its position as among the top 10 tradable assets in the world by market capitalization.
Surprisingly, the trading volume of the cryptocurrency is down by around 7% in the same period as $49.94 billion worth of BTC moved between wallet addresses. The same span saw prices swing between a $56,329 low and the current top above $60,500.
The rally narrows the gap between Bitcoin’s prevailing valuation and ATH by less than 13%.
What’s Prodding the Bulls?
The year 2024 started with high hopes for Bitcoin as it anticipated two major events taking place in its ecosystem. One was the much-awaited approval of spot Bitcoin exchange-traded funds (ETFs) in the US by the Securities and Exchange Commission (SEC) and the other was the halving.
The former already occurred on January 11, which has proven to be a lucrative venture for providers like BlackRock, Fidelity, Grayscale, and others. During Tuesday’s trading, spot Bitcoin ETFs generated a staggering trading volume of more than $3 billion. Notably, it’s the second consecutive day they have displayed such a feat.
BlackRock led the charge with $1.32 billion cashflows followed by Grayscale at $799.16 million, Fidelity at $576.81 million, and Ark Invest at $203.76 million. The rest of the gang went from $78.16 million (for Bitwise) down to $1.36 million (for Hashdex).
However, the key narrative that has greater weight than spot Bitcoin ETFs is the halving occurring sometime between April 18 and 20 as soon as BTC reaches its 840,000th block height. Historically, these cycles have resulted in new ATH for Bitcoin because of its deflationary nature.
As a recap, each Bitcoin halving cycle reduces mining rewards by 50%. In the current epoch, miners on the network’s proof-of-work protocol are rewarded 6.25 BTC per block mined. This will be scaled down to 3.125 BTC by April, which will result in tighter competition among miners as well as scarcer supply amidst the growing institutional demand for the crypto asset.
With these, analysts predict that it might catalyze a new ATH for Bitcoin, and the consensus points to a possible $100K peak or even more after the halving.