Bitcoin bounces to all-time high

Bitcoin briefly hit an all-time high on Tuesday – with the world’s largest cryptocurrency surpassing US$68,800, according to CoinMarketCap. That’s just above bitcoin’s previous record set in November 2021.

The price of the volatile asset is up almost 200 per cent from one year ago. Gains for bitcoin have piled up over recent months, largely due to the excitement leading up to and following regulatory approval of spot bitcoin exchange traded funds, or ETFs, earlier this year.

Analysts credit the latest surge to the growing popularity of this new way to invest combined with building anticipation for a scheduled bitcoin “halving” next month.

Bitcoin has a history of drastic swings in price, which can come suddenly and happen over the weekend or overnight in its 24/7 trading cycle.

Bitcoin rocketed from just over US$5,000 at the start of the pandemic to its November 2021 peak of nearly US$69,000, in a period marked by a surge in demand for technology products. Prices fell back to earth during an aggressive series of Federal Reserve rate hikes aimed at taming inflation and then the 2022 collapse of crypto exchange giant FTX, which left a significant scar on the public’s confidence in the industry.

At the start of last year, a single bitcoin could be had for less than US$17,000. Investors, however, began returning in large numbers as inflation started to cool. And 2023’s collapse of prominent tech-focused banks actually led more investors to turn to crypto as they bailed out of positions in Silicon Valley start-ups and other risky bets.

Despite the recent excitement around bitcoin, experts still maintain that crypto is a risky bet with wildly unpredictable fluctuations in value. In short, investors can lose money as quickly as they make it.

As of around 10:30 a.m. ET, bitcoin stood at US$67,427 according to CoinMarketCap.

AP