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GUANGZHOU, China – Bitcoin crossed $ 37,700 to a new record high on Thursday, pushing the total value of the entire cryptocurrency market above $ 1 trillion for the first time.
The digital coin hit an all-time high of $ 37,739.08 at around 1:44 p.m. Singapore time, just hours after surpassing $ 36,000, according to data from Coindesk.
Bitcoin was over 5% from the previous day at around 2:42 p.m. Singapore time.
The cryptocurrency has grown by around 29% since the start of 2021 and over the past 12 months has jumped over 380%.
Meanwhile, the value of the entire cryptocurrency market, which is made up of bitcoin and other digital coins like ether and cable, topped $ 1 trillion for the first time early Thursday, according to data from Coinmarketcap.
The resurgence of Bitcoin has been attributed to a number of factors, including an increase in purchases from large institutional investors. High profile investors like Paul Tudor Jones, for example, have bought bitcoin.
Many Bitcoin bulls say the cryptocurrency is akin to “digital gold,” a potential safe haven asset and a hedge against inflation. In a recent research note, JPMorgan said bitcoin could hit $ 146,000 in the long run as it competes with gold as an “alternative” currency. Investment banking strategists noted, however, that bitcoin would need to become significantly less volatile to reach this price. Bitcoin is known for its wild price swings.
The idea of bitcoin as an inflation hedge has continued to gain momentum as governments around the world embark on large-scale fiscal stimulus programs. Analysts say this could cause inflation to spike.
“This latest bull run in January will certainly catch the attention of asset managers to further diversify their assets into crypto, as they are keen to find alternative investments, such as cryptocurrency or gold, to cover. inflation and geopolitical risks, ”Simons Chen told CNBC the executive director of investments and trading at cryptocurrency financial services firm Babel Finance.
“A large number of retail investors have also joined the race recently because they fear missing out on opportunities to take an easy and quick profit from the latest bull run,” he added.
But some bitcoin critics – such as David Rosenberg, economist and strategist at Rosenberg Research – have called bitcoin a bubble.
“The parabolic movement of bitcoin in such a short time, I would say for all safety, is very abnormal,” Rosenberg told CNBC earlier this month.
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