At the auction on Monday, March 11, the price of Bitcoin reached a new all-time high.
In the first half of the day, the rate of the electronic coin rose by 3.6% and for the first time in the entire period of observation reached $71.46 thousand. This data is provided by the CoinMarketCap portal.
Following Bitcoin, other cryptocurrencies showed similar dynamics.
Thus, Ethereum rose in price by 3.7%, to $4.02 thousand - the highest level since December 2021.
At the same time, ripple quotes grew by 2.7% to $0.62, and litecoin by 4% to $90.89.
The total value of all cryptocurrencies over the past 24 hours has grown by about $50 billion and was currently approaching $2.68 trillion.
The last time such a high figure could be observed was back in November 2021.
Since the beginning of this year, the price of Bitcoin has increased by almost 70%.
Experts believe that one of the main reasons for this dynamics is the rush of investments into the cryptocurrency market.
“We see growing demand, primarily from institutional investors.
Thus, more and more large investment companies, hedge funds and organizations from the traditional financial sector are including Bitcoin in their investment portfolios,” Vladislav Antonov, a financial analyst at BitRiver, told RT.
According to him, the interest of world investors in purchasing electronic coins was fueled by the launch of the first Bitcoin ETF in the United States in January 2024.
Let us clarify that we are talking about special funds whose securities are traded on the stock exchange at the price of cryptocurrency.
The emergence of such a tool has simplified investments in digital money.
“This has opened up Bitcoin investing to a huge number of investors through brokerage accounts and platforms.
Trading volumes of these ETFs have already reached historical highs many times,” Antonov noted.
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Moreover, with growing uncertainty in the world, some investors are considering buying Bitcoin and other electronic coins as a way to save money.
This point of view was expressed in an interview with RT by the President of the Russian Association of Cryptoeconomics, Artificial Intelligence and Blockchain (RACIB), Yuri Pripachkin.
“Financial market players are concerned about the general geopolitical tensions, as well as the situation in the US economy: many are afraid of the bubble in the American stock market.
In this regard, people are increasingly looking at Bitcoin as an alternative to other traditional defensive assets,” explained Pripachkin.
Minor Reward
Also, according to analysts, the Bitcoin rate is growing rapidly on the eve of the next halving - a change in the rules for mining the digital coin.
Traditionally, the event occurs every four years and is one of the determining factors for the dynamics of the global cryptocurrency market.
Let us remind you that Bitcoin exists on the basis of blockchain technology - a single database that contains information about all completed transactions.
The emission of new cryptocoins occurs through mining - solving complex mathematical problems and the appearance of a new block in the blockchain network.
Each such block is an array of data that contains information about all transactions carried out after the creation of the previous block.
Miners receive bitcoins as a reward for solving the problem.
Currently, over 19.65 million electronic coins have already been mined in this way.
At the same time, according to the developers, unlike endlessly printed paper money, the number of bitcoins is limited and can be a maximum of 21 million.
Meanwhile, every year the issue of cryptocurrency becomes more difficult and requires more and more computing power, and the reward for mining decreases.
So, in 2009 it was 50 bitcoins per block, in 2012 it dropped to 25 coins, in 2016 - to 12.5, and in 2020 - to 6.25.
The next halving should happen in mid-April 2024.
After this, the miners’ reward will again be halved and will be slightly less than 3.13 bitcoins.
“Reducing the volume of Bitcoin emission while the demand for it is growing can lead to the formation of a shortage.
Cryptocurrency is rising in price based on these expectations.
It is worth noting that previous halvings always triggered a new cycle of price increases,” explained Vladislav Antonov.
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According to Yuri Pripachkin’s forecast, over the next few months the price of Bitcoin may rise above $90 thousand. However, after this the price will probably “roll back” to about $60 thousand, as investors will want to lock in the profits and begin to sell the asset en masse.
“Following growth, a pullback will certainly follow.
The only question is what it will be like.
Few people pay attention to the fact that the majority of investors do not use bitcoins, but simply purchase them and, relatively speaking, put them on the shelf.
At the same time, there are players who constantly buy and sell cryptocurrency, that is, they speculate.
This is precisely what explains the high volatility of the market,” Pripachkin emphasized.
Note that the last time a rapid increase in the price of Bitcoin could be observed was in 2021.
Then, from January to mid-November, the value of the cryptocurrency more than doubled and reached a record at that time of $69 thousand. Following this, quotes began to decline and already at the beginning of 2022 dropped to $33 thousand, and by the end of autumn they fell to $15.5 thousand. However, after such a sharp collapse, starting in 2023, the rate of the electronic coin began to gradually increase again and at the end of the year exceeded $42 thousand.