- Reuters suggests that the recent surge in bitcoin’s value, driven by institutional investment, may be more sustainable than its 2021 growth.
- Bitcoin peaked at $69,202 on Tuesday, propelled by enthusiasm for new U.S. spot bitcoin exchange-traded funds (ETFs) and expectations of Federal Reserve interest rate cuts.
The recent significant surge in bitcoin’s value to a new peak could potentially have greater sustainability compared to its growth in 2021, due to the ongoing investment influx from established institutions into the cryptocurrency, according to Reuters.
Bitcoin peaks on Tuesday
The world’s largest cryptocurrency reached a value of $69,202 on Tuesday, fueled by excitement over the introduction of new U.S. spot bitcoin exchange-traded funds (ETFs) and the expectation of the Federal Reserve initiating a reduction in U.S. interest rates this year.
Also read: Bitcoin all-time high: Records expected to fall as BTC nears $69,000
Crypto rollercoaster
In November 2021, just months after enthusiastic retail investment pushed bitcoin to its previous peak, the cryptocurrency plummeted, dragging down half of the crypto industry with it.
However, more institutions investing long-term capital might support the token’s ability to maintain its high levels this time around, according to experts and executives.
Nathan McCauley, CEO of cryptocurrency platform Anchorage Digital, stated: “Traditional institutions were once sitting out; today, they are here in full force as the principal drivers of the crypto bull market.”
Bitfinex analysts also commented: “Any decline following the top of the current cycle could be less drastic than previous downturns. We saw a similar stable trajectory in price after a huge increase following the launch of gold ETFs.”
