Bitcoin Hits $50K for First Time in Over Two Years
Bitcoin Surges Past $50,000
Bitcoin has reached the $50,000 level for the first time in more than two years. This surge in the world’s largest cryptocurrency is attributed to expectations of interest rate cuts later this year and the recent regulatory approval for U.S. exchange-traded funds designed to track its price.
Market Impact and Performance
The cryptocurrency has seen a 16.3% increase so far this year, reaching its highest point since December 27, 2021. At 12:56 p.m. EST (1756 GMT), bitcoin was up 4.96% on the day at $49,899, showing strong performance around the $50,000 level.
Expert Commentary
Antoni Trenchev, co-founder of crypto lending platform Nexo, commented, “$50,000 is a significant milestone for bitcoin after the launch of spot ETFs last month not only failed to elicit a move above this key psychological level but led to a 20% sell-off.”
Rise in Crypto Stocks
Crypto stocks also experienced a boost, with crypto exchange Coinbase up 4.9% and crypto miners Riot Platforms and Marathon Digital up 10.8% and 11.9%, respectively. Shares of software firm MicroStrategy, a notable buyer of bitcoin, were up 10.2%.
Rise of Ether
The price of ether, the second-largest cryptocurrency, was up 4.12% at $2,607.57, reflecting the overall positive sentiment in the cryptocurrency market.
Global Market Sentiment
Global stock indexes also edged higher on Monday as traders looked for cues on when the U.S. Federal Reserve might begin cutting interest rates. Analysts and financial market expectations both point to May as a potential start for rate cuts this year.
Impact of ETFs
The primary driver behind bitcoin’s recent price appreciation “can be attributed to the increased inflow into BTC spot ETFs,” said Matteo Greco, a research analyst at fintech investment firm Fineqia International, in a research note.
Outlook for the Future
Investors are eagerly awaiting the approval of ethereum spot ETFs and the next bitcoin “halving,” expected in April. Analysts believe these events will have significant implications for the cryptocurrency market.
With the fourth bitcoin halving, a first Fed interest rate cut, and potential ethereum spot ETF approval, all are significant for what is the smallest, youngest, and most retail-dominated asset class,” said Ben Laidler, global markets strategist at eToro.
