Topline
Bitcoin topped $57,000 for the first time in more than two years on Tuesday, propelled by purchases from large investors and booming demand through exchange-traded funds (ETFs) as the market bounces back from dire straits in 2022 brought about by the collapse of major players like Sam Bankman-Fried’s FTX, Celsius and Three Arrows.
Key Facts
The price of bitcoin briefly passed the $57,000 mark for the first time since late 2021 during the early morning in Asia and late evening in the U.S.
On Monday, bitcoin cleared the $53,000 threshold for the first time since November 2021, and prices grew to $54,000 before climbing rapidly to $57,000 in a matter of minutes on Tuesday.
The digital asset pared some of its gains and was trading at around $56,300 at 5 a.m. Eastern, still a jump of nearly 10% over the last 24 hours.
Bitcoin’s growth is part of a broader rally in the crypto markets, with the price of ether reaching $3,274 on Tuesday.
The price marks an uptick of nearly 7% over the last 24 hours and it is ether’s highest price since April 2022.
News Peg
The uptick in bitcoin and ether, the world’s two biggest cryptocurrencies by market capitalization, continues a broader rally in recent months across the digital asset economy. Bitcoin has grown around a third (33%) and ether by more than 40% since the start of the year. Increased investor enthusiasm through bitcoin ETFs which the Securities and Exchange Commission authorized for the first time in January, and the disclosure of major bitcoin holdings by investors like MicroStrategy have buoyed interest, as have hopes ether ETFs will secure approval soon. The market has yet to reach the highs it did in late 2021, when overall value briefly eclipsed $3 trillion. It is still recovering from a series of crashes precipitated by numerous high profile failures and scandals starting towards the end of that year, including the implosion of Bankman-Fried’s FTX exchange, the collapse of market institutions like lender Celsius and investor Three Arrows Capital and stablecoins like Tether and terraUSD (UST)—supported by token luna—slipping their $1 pegs, with the latter network failing dramatically and erasing billions in value.
What To Watch For
The upcoming bitcoin halving event is also a potential driver of market growth. The event, which decreases the amount of bitcoin rewarded when “mining” the cryptocurrency and is part of the cryptocurrency’s mathematical underpinning to control supply, has historically bumped the price of the token. Halving happens after a set number of blocks—parts of the distributed blockchain of records and data that cryptocurrency transactions are built upon—are mined and experts predict bitcoin will cross the next threshold around April 2024.
Big Number
$2.23 trillion. That’s how much Forbes estimates the total cryptocurrency market is worth. The value of the market has grown nearly 7% in the last 24 hours. The uptick in bitcoin and ether is responsible for a significant portion of this boom as the two cryptocurrencies respectively make up around 44.5% and 17.3% of the overall crypto market.
Further Reading