Coinspeaker
Bitcoin Price Surpasses Its 2021 All-time High, Reaching Peak of $69,170
On Tuesday, Bitcoin (BTC), the leading cryptocurrency in the market, once again hit a historic milestone by surpassing its previous all-time high of $69,044 reached on November 10, 2021. This time, the price of the digital asset managed to achieve a peak of $69,170 driven by a series of factors that have renewed investors’ appetite.
The main catalyst behind this bullish rally of Bitcoin has been the recent approval by US regulators of a series of ETFs (exchange-traded funds) that replicate the price of BTC. After many years of delays, the Securities and Exchange Commission (SEC) finally gave the green light to these innovative products in January 2023.
The approval of Bitcoin ETFs opened the doors to massive entry of institutional and retail capital into the cryptocurrency market. In just two months, the ETFs have managed to attract more than $50 billion, led by BlackRock’s iShares fund, which already manages more than $10 billion in BTC.
It is important to highlight that, within just a week since their launch, Bitcoin ETFs managed to rank second among individual commodity-based products with the highest assets under management (AUM), setting a record that took gold products several years to achieve.
Furthermore, the operational simplicity of ETFs has facilitated access to Bitcoin for traditional investors, in addition to foreshadowing greater adoption by the financial establishment. This is compounded by the prospect of a reduction in new Bitcoin issuances with the upcoming “halving” scheduled for April, a cyclical event that historically has triggered strong price increases.
What do Analysts Think about the Future Price of Bitcoin?
Several analysts have shared their perspectives on the bullish rally of Bitcoin and their price projections with various specialized media outlets. In comments to CoinDesk, Aurelie Barthere from Nansen suggested that the end of the cycle of rate hikes stipulated by the Federal Reserve likely contributed to BTC’s rebound since November 2023.
“The strong performance of risk assets overall, like crypto, equities, credit, tells us that financing conditions have probably loosened, especially since November last year and the peak in rates […] Investors are also really sanguine about macro prospects (recession no longer consensus), and the risk premium linked to uncertainty about a potential growth shock has come down,” Barthere noted.
On the other hand, Alex Thorn from Galaxy Digital expressed optimism about the price increase of Bitcoin in statements to CNBC, explaining:
“Bitcoin becomes more useful as it grows more valuable, […] At higher market caps and daily float, it can support larger allocations. Bitcoin’s volatility has consistently decreased over time, allowing allocations to take larger position sizes.”
However, some analysts warn of possible short-term corrections. Ed Tolson, CEO and founder of the crypto hedge fund Kbit, commented to CNBC that the market is prepared to experience a sharp correction at any time, “possibly between 10% and 20%”, triggering massive liquidations. However, in the long run, the analyst remains bullish.
“Any material move down will result in cascading liquidations on the crypto perpetual swap markets, where retail has piled into levered long positions. This will drive funding rates very high. Over the next few quarters, we expect bitcoin to perform well, but with sharp corrections along the way,” Tolson said.
At the time of writing this note, BTC is trading at $64,340, almost 7% below its historical high of $69,170. However, the crypto market’s euphoria over Bitcoin’s milestone continues unabated on crypto Twitter.
Bitcoin Price Surpasses Its 2021 All-time High, Reaching Peak of $69,170
