Bitcoin Breaks Through $20,000 To Hit A Fresh All-Time High
Bitcoin rallied today, climbing above $20,000 for the first time in history and notching a new all-time high.
The world’s most prominent digital currency broke through the $20,000 level around 8:30 a.m. EST, CoinDesk figures show.
The cryptocurrency rose to as much as $20,817.80 at roughly 9:15 a.m., additional CoinDesk data reveals.
By rallying to this price point, bitcoin was up roughly 190% since the start of the year and nearly 440% from its 2020 low of less than $3,900 reached in March.
[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
How This Bull Market Is Different
The current bull run is significantly different from the rally that pushed bitcoin prices to an all-time high in late 2017.
While the prior run-up was driven by factors like strong retail interest and widespread media coverage, this latest rally has taken place amid a global pandemic and rising institutional adoption.
As the coronavirus pandemic brought industries around the world to a virtual standstill, causing companies to shutter and people to lose jobs, many governments responded with monetary stimulus, requiring them to print trillions of dollars.
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While these measures may have been helpful in the short-term, they have prompted concerns that more traditional fiat currencies like the U.S. dollar will lose their purchasing power.
Some have interpreted this development as the latest signal that digital currencies are the future.
Further, some institutions have been making highly visible purchases of bitcoin, with a perfect example being MassMutual’s recent decision to invest $100 million into the digital currency.
Another great example is software company MicroStrategy’s recent decision to purchase more than 40,000 units of bitcoin this year, spending $475 million between three separate transactions and generating significant headlines in doing so.
In addition to these moves, MicroStrategy recently sold more than $600 million worth of notes, with the intention of using the proceeds to buy bitcoin.
Now that bitcoin has climbed to a fresh record high, it will be interesting to see what price levels it attains going forward.
Denis Vinokourov, head of research for London-based digital asset firm Bequant, spoke to this situation, stating that:
“Now that Bitcoin has passed $20,000, expect another wave of retail flow to materialize and drive the leading crypto asset higher.”
“FOMO is now in overdrive, as people who missed out on the last run to nearly $20,000 don’t want to stay on the sidelines again.”
“Increasing institutional adoption will further support this rally and should easily help prices consolidate, setting the stage for a run towards $25,000 as we head into the new year.”
Disclosure: I own some bitcoin, bitcoin cash, litecoin, ether and EOS.