Bitcoin Price Reaches New All-Time High
Bitcoin crossed the $69k barrier for the first time since 2021. This record triggered massive sales that dipped the price back down, but all the signs are still bullish.
Although the price subsequently tumbled through the rest of the day, Bitcoin finally broke its record for highest valuation ever on March 5, 2024.
It’s been a long time coming. Ever since Bitcoin began steadily climbing in the latter half of 2023, there’s been persistent discussion in the community of whether or not this particular rally would take us back to the coveted price mark of $69k, achieved during a price spike in 2021. A variety of factors, most commonly credited as the hype wave around a potential spot ETF, took Bitcoin’s price steadily up for several months, but the actual ETF approval led to a shaky couple of weeks in the market. As February came in, however, the ETF market was fully stabilized, and Bitcoin began rocketing up as dramatically as it has in all the previous record-setting price spikes.
A few factors have come together to generate this wave of success for Bitcoin. For starters, everyone has something to look forward to, as the next Bitcoin halving is coming up. As part of Bitcoin’s original DNA, the mining algorithms programmed into the blockchain are set to cut all mining rewards in half when certain thresholds are reached, prolonging the lifespan of a finite bitcoin supply for years into the future. The halving can force the mining industry to radically increase its efficiency, and this is one of several reasons that previous halving’s are typically associated with prosperity for Bitcoin. This fact is important to remember: unrelated factors in the market have done a lot of heavy lifting to get Bitcoin to this point, but the halving is a durable reason to believe that the bull market will continue.
Nevertheless, there is clearly one major culprit for Bitcoin’s success in 2024: the ETF market. Globally, crypto-related investment funds of all stripes shattered previous trading records last week as the various financial instruments entangled with prominent digital assets pulled in a collective $30 billion in trading volume between them. Although this figure seems impressive, a closer look at the data reveals a deeper truth: 30 billion for all financial instruments in all cryptocurrencies, and 22.3 billion of that came from the Bitcoin spot ETF. Of the remaining 7.7 billion, large sums of this even came from Bitcoin futures ETFs, also connected to the same underlying asset. Fierce competition between some of the leading spot ETF providers marked the early market fluctuations, but the market has now settled to accept BlackRock as the clear leader of the pack. Moving forward, this traditional asset manager has displayed a vast capacity to accept new customers.
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On Monday, March 4, Bitcoin kicked off a new week by topping the all-time price value in euros. Although this particular milestone is nothing to sneeze at, it still came as a minor disappointment when Bitcoin never quite passed its all-time dollar threshold by the end of the day. However, short sellers still saw a massacre as their bets against Bitcoin were liquidated, with the traders themselves averaging nearly $110k lost per minute throughout the course of the day. These losses were not entirely caused by Bitcoin, as other crypto assets were also entangled in short positions throughout the entire industry, but Bitcoin’s success drove the overall rout. These successes led to a great deal of hype throughout the community, and for good reason; as writer and analyst Dylan LeClair pointed out, there are four instances of Bitcoin’s value doubling within 90 days of crossing a previous all-time record. The most recent of these periods, in 2020, took place in less than three weeks.
In other words, it came as no surprise when Bitcoin finally crossed the $69k mark into new record-breaking territory on March 5. Bitcoin rose more than 20% in seven days and spawned a series of enthusiastic predictions in its wake. Analysts from Bitfinex claimed that “Bitcoin could see a 130–150% rally in the year following the halving, which would lead to a peak in the range of $125,000–$150,000 in 2025” and took pains to clarify that these optimistic predictions are rooted in the future prospects of the halving. However, when Bitcoin fell by 3.2% less than 30 minutes after the price threshold was reached, minor unfortunate developments ensued.
Although the average Bitcoin short seller certainly took a haircut from the runup to the price record, there are still whales with vast reserves of capital that are able to dictate terms to the market. As the price reached closer to the all-time highs, a series of book order sales were triggered: individual accounts began selling sums of BTC as high as 300–500 at these inflated prices. These are no mean sums, with a collective $800 million liquidated from these rapid and massive sales over the course of hours. Bitcoin took a tumble in turn, ending up with a decline of nearly 10% in short order and hitting a low point below $62k. This wave of aggressive selloffs was not limited to the dollar market, as Bitcoin’s relation to the Euro also quickly submerged below its previous high.
Nevertheless, this tumble is looking to be a short-lived one, even if its speed and ferocity were unexpected. Within an hour and a half of the low point, Bitcoin had already popped back above $64k. In other words, the price is still ahead of where it was on Sunday, even despite the rise and decline. For this reason, it’s critically important that Bitcoiners remember the fundamentals that went behind these recent successes. Even if it weren’t the case that billions of dollars were flowing into the ETF market, and they are, we can still look forward to the halving as a buoy for continued prosperity. There are reasons, after all, that analysts from Bloomberg predicted that Bitcoin ETFs will surpass gold ETFs in assets under management within two years.
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Bitcoin has gone through an intensely volatile market over the years, practically throughout its entire career as the oldest digital currency. And yet, it can still come as a shock when moments like this occur and we watch Bitcoin’s price take massive hits at the moment of greatest triumph. This is especially true considering that price actions like this are frequently the consequence of deliberate moves from major players in the space and that price spikes make for an excellent opportunity for a big mover to make millions. All the recent times that Bitcoin hit an all-time record, it was one dot in a series of formidable data points, as the overall value either lingered just under it or crossed incrementally new records at several points. There’s absolutely zero reason to believe that we aren’t in a similar situation, and Bitcoin could set an even newer world record within a matter of days or hours.
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