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Bitcoin price hits a new all-time high on March 5th, 2024

 

The price of Bitcoin surged to a remarkable new peak, exceeding $69,200 on March 5th, with a notable 5% increase within a mere 24-hour period. This surge marks a substantial rise of over 21% throughout the past week, surpassing its previous all-time high of $68,990 observed on the Coinbase exchange back on November 10, 2021.

This record-breaking high is attributed in part to substantial inflows from newly established spot Bitcoin exchange-traded funds (ETFs) within the United States. These ETFs have introduced a passive, price-agnostic demand for Bitcoin, reinforcing its stature as a store of value and consequently propelling its value upwards.

As per a research, a conservative projection places Bitcoin’s price in the range of $100,000 to $120,000 to potentially be realized by the fourth quarter of 2024, with the culmination of the current cycle anticipated sometime in 2025 in terms of total crypto market capitalization.

Despite this milestone, Bitcoin could potentially face substantial volatility post the upcoming halving event, according to Paul Eisma, head of options trading at XBTO Futures. Eisma emphasized the unique scenario of simultaneous pressure from the halving’s deflationary supply impact and the ongoing demand shock from the ETFs. Notably, options market indicators suggest a forward break-even range of $55,000 to $85,000 by December 2024, with an implied volatility of approximately 65%.

Furthermore, the emergence of these spot ETFs could serve to mitigate Bitcoin’s downside volatility following the attainment of new cycle peaks. This is comparable to the stable trajectory witnessed in the price of gold subsequent to the launch of gold ETFs. Notably, by February 15, Bitcoin ETFs had accounted for approximately 75% of new investments in the cryptocurrency, as it crossed the $50,000 mark, according to CryptoQuant research.

Projections suggest that Bitcoin ETFs may even surpass gold ETFs in terms of assets under management within the next two years, as outlined in a research report by senior Bloomberg analyst Eric Balchunas and associate analyst Andre Yapp.

Wasif Shakir

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