Bitcoin reached its highest point in over two years, surpassing $53,000, driven by increasing optimism about sustained investor demand through exchange-traded funds (ETFs), Bloomberg reported.
Spencer Hallarn, the global head of over-the-counter trading at crypto investment firm GSR, told the publication that the cryptocurrencies‘ ascent, is “supported by strong ETF inflows”.
The world’s largest cryptocurrency saw a rise of up to 3.5 percent, reaching $53,600. The last time Bitcoin traded at this level was in December 2021 when it achieved an all-time high of almost $69,000 the preceding month.
In the past month, investors have allocated over $5 billion across nine newly launched ETFs. This amount considers the $7.4 billion withdrawn from the Grayscale Bitcoin Trust, which underwent conversion from a trust during the same period.
Market Dynamics Fuel Bitcoin’s Rise
“Bitcoin is approaching new yearly highs off the back of increased spot demand and momentum traders taking positions after a week of consolidation,” Chris Newhouse, a DeFi analyst at Cumberland Labs told Bloomberg. Despite the rise, liquidations are not excessively high for the current price action, with leveraged longs quickly replacing liquidated shorts.
Newhouse pointed out a noticeable increase in the open interest, or outstanding contracts, for perpetual Bitcoin futures. Simultaneously, short positions have been compelled to close during the latest rally, potentially due to fresh long positions entering the market.
MicroStrategy Boosts Confidence with Large Bitcoin Purchase
MicroStrategy Inc., known for integrating Bitcoin into its corporate strategy, announced the acquisition of approximately 3,000 cryptocurrency tokens this month for $155.4 million. With a total Bitcoin holding of around $10 billion, this move has added to the positive sentiment surrounding Bitcoin.
Following the announcement, shares of MicroStrategy surged around 14 percent. Other crypto-related stocks also experienced rallies, with Coinbase Global rising 14 percent, and Bitcoin miner Marathon Digital witnessing an almost 20 percent jump.
(With inputs from Bloomberg)
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