TOKYO (Reuters) – Bitcoin consolidated about $ 60,000 on Monday, pausing after the weekend record, as investors braced for concerns about U.S. inflation and stimulus spending to boost it it even more.
The world’s most popular cryptocurrency dropped to $ 58,956.90 at the start of the Asian session, dropping from Saturday’s record $ 61,781.83.
The recovery may have been dampened by a Reuters report that India would seek a ban on digital assets, a rain cloud for bitcoin after high-profile endorsements this year from companies like Tesla’s Elon Musk, Twitter’s Jack Dorsey and giants of the investment Goldman Sachs and Pedra Preta.
Bitcoin more than doubled in 2021, after quadrupling last year.
“The investment of institutional investors and companies is increasing. That’s what I call bitcoin financialization, ”said Masafumi Yamamoto, chief exchange strategist at Mizuho Securities.
“It is becoming an asset that investors can no longer ignore.”
The rise of Bitcoin over the weekend was helped by an improvement in risk appetite in the financial markets after President Joe Biden sanctioned his $ 1.9 trillion fiscal stimulus package and ordered an acceleration in vaccinations.
That boost hit the narrowest markets over the weekend, with technical factors expanding the movement, according to Justin d’Anethan, sales manager at Diginex, a digital assets company in Hong Kong.
“The crypto market is heavy on derivatives,” he noted.
“A small upward movement triggered many sales across Saturday and Sunday, making it a not-so-small movement.”
Seth Melamed, chief operating officer of the Tokyo-based cryptocurrency exchange Liquid, said the legislation of the kind that India is proposing will not be an impediment to future earnings for bitcoin.
“Because it is decentralized, the ban or acceptance by the government is somewhat irrelevant,” said Melamed. “Capital will find a way.”
Kevin Buckland reporting; Additional reporting by Sagarika Jaisinghani and Alun John; Editing by Vidya Ranganathan and Jacqueline Wong