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Bitcoin rose above the $ 51,000 level for the first time on Wednesday.
According to Coin Metrics, the brand new cryptocurrency reached a new record price of USD 51,715 at around 4:50 a.m.CET. It later traded 5% higher at $ 51,024.
Bitcoin was founded in 2009, not long after the global financial crisis. It has gone from being a protest against the banking system to being a “digital gold” catching on with mainstream investors.
On Wall Street, major investment banks seem to be warming to Bitcoin. JPMorgan recently said it was seriously looking at the asset class, and Goldman Sachs has shown interest in crypto too. A division of Morgan Stanley is reportedly considering adding Bitcoin to its list of possible bets.
Companies like PayPal and Mastercard have taken important steps to support cryptocurrencies. And Tesla said last week it had invested $ 1.5 billion in Bitcoin and planned to accept the digital currency as a means of payment for its products.
“We believe the story and topic here is much bigger than just investing in Bitcoin and predicting its future price, but rather the potential impact that crypto, blockchain and bitcoin will have on the technology and business worlds for the next decade “said Dan Ives, chief executive officer of Wedbush Securities, said in a note on Wednesday.
“From Paypal and Square to companies like Nvidia, Tesla, IBM, Visa, Mastercard and many other companies in various industries, we believe that the trend towards transactions, Bitcoin investments and blockchain-driven initiatives will increase in the years to come as Bitcoin.” In our opinion, mania is not a fad, but the dawn of a new era in the field of digital currency. “
Bitcoin’s recent rally has reminded many investors of the massive spike to nearly $ 20,000 in 2017, followed by a slump the following year in which the digital coin lost 80% of its value.
But the world’s most valuable cryptocurrency has since made a violent comeback, more than quadrupling in 2020 and up over 70% this year.
Bitcoin proponents say this was due to increased demand from institutional investors, as well as the purchase of the digital currency by companies like Tesla, Square and MicroStrategy. Skeptics, on the other hand, fear that Bitcoin could be the largest market bubble in the financial markets.
JPMorgan strategists warned in a note Tuesday that the current price of Bitcoin would be “unsustainable” unless Bitcoin’s volatility subsided. Bitcoin and other cryptocurrencies have made a name for themselves for their extreme price fluctuations.