On February 29, Bitcoin's price continued to soar, reaching a new high since November 2021. The cryptocurrency saw a daily increase of over 7%, with its highest price touching $64,000, just a stone's throw away from its all-time high of nearly $69,000. As the price climbed, Bitcoin's market cap once again exceeded $1.2 trillion, putting it on par with tech giant Meta. As of this writing, Bitcoin's price has fallen back to just over $61,000.
The image is from CoinMarketCap.
Market participants believe that the current bullish trend is primarily driven by the approval of the January Bitcoin spot ETF and the impending Bitcoin halving impact.
Ben Laidler, Global Market Strategist at the crypto retail investment platform eToro, states that Bitcoin is supported by the continuous influx of new spot ETFs and influenced by the upcoming April halving event, along with market expectations of a June interest rate cut by the Federal Reserve.
Last month, after the U.S. Securities and Exchange Commission (SEC) approved the first 11 Bitcoin spot ETFs, billions of dollars flowed into the Bitcoin market, contributing to the upward movement in Bitcoin prices.
On the other hand, the Bitcoin halving is set to occur in late April. A cryptocurrency observer previously informed The Paper (www.thepaper.cn) that this year's Bitcoin production will halve again, marking a significant event altering the supply-demand dynamics of Bitcoin. Taking place approximately every four years as an inherent feature of Bitcoin, the halving automatically reduces the rate at which new bitcoins enter circulation. Yu Jianing, Co-Chair of the Blockchain Special Committee of the China Communications Industry Association and Honorary Chair of the Hong Kong Blockchain Association, analyzed to The Paper that market optimism about the upcoming Bitcoin halving event may also contribute to a surge in Bitcoin prices during this period.
Antoni Trenchev, Co-founder of the cryptocurrency exchange Nexo, anticipates some resistance as Bitcoin approaches $69,000, but breaking the $60,000 price point is expected to spark interest from investors who have not yet participated in this rebound, especially retail investors.
The last time Bitcoin surpassed $60,000 was in October to November 2021, reaching its all-time high of $68,800 on November 10, 2021. After reaching the peak, Bitcoin experienced a decline until it reached a low of around $16,000 at the end of 2022. Since November 2022, the crypto industry faced a "Lehman moment," with several crypto companies collapsing, including the major crypto exchange FTX and the crypto lending platform BlockFi. Bitcoin's price fell below $16,000 until a market recovery in early 2023.
With this recent Bitcoin bull run, crypto trading platforms are facing pressure. On February 28th, Coinbase CEO Brian Armstrong stated on social media that the platform is dealing with a massive surge in traffic, and the team is actively working on fixes. The Coinbase support department mentioned that some users may see zero account balances, and errors may occur during trading.
Image courtesy of X (formerly Twitter)
