Photographer: Chris Ratcliffe / Bloomberg
Photographer: Chris Ratcliffe / Bloomberg
The total market value of cryptocurrencies has exceeded $ 1 trillion for the first time on Thursday amid Bitcoin’s frantic and volatile high for yet another record.
Cryptocurrencies hit the mark after a five-fold rise in market value last year, data from the CoinGecko tracker show. Strategists cited the demand from speculative retail traders, trend-setting amount funds, the wealthy and even institutional investors as some of the reasons for the increase.
Bitcoin rose 6% on Thursday to hit a high of $ 38,169 and more than quadrupled last year, according to a price composition compiled by Bloomberg. It accounts for about two-thirds of the cryptocurrency’s market value, followed by Ether by about 13%, according to CoinGecko Dice.
Digital currencies are bouncing in a world flooded with fiscal and monetary stimulus, although some commentators fear an inevitable crash and others question the basics integrity of cryptographic markets. Bitcoin supporters argue that it offers protection against the weakness of the dollar and the risk of faster inflation, a bit like gold, while critics criticize the intellectual strength of comparing the two assets.
“The more people realize that their assets, especially their liquid assets, like fiat currencies, are losing value, the more they look for alternatives,” said Geoffrey Morphy, president of the Canadian crypto mining company. Bitfarms Ltd.
Active Bitcoin accounts are approaching the highest levels ever in late 2017, according to researcher Flipside Crypto – possibly a sign that some holders are planning sell. Less than 2% of accounts hold 95% of Bitcoin’s supply, so some large transactions can affect prices. The last big Bitcoin boom began to implode in late 2017.
Some traders pointed to JPMorgan Chase & Co.’s long term Bitcoin price forecast of $ 146,000, possibly fueling the rally. Others said the sentiment was driven by a US regulatory update that allows a less volatile currency class to be used by banks for payments.
– With the help of Lynn Thomasson and Eric Lam
(Updates with market movements.)