With over 3% gains in the last 24 hours, Bitcoin trades above $110,000 and has set a new all-time high. Even though the cryptocurrency has seen major swings in the past few months, this was the first time it traded above its previously long-held January 20 peak. With this, Bitcoin has overtaken Amazon and Google to become the 5th biggest asset in the world.
Courtesy: CoinMarketCap.com
The world’s largest cryptocurrency has gained 17.5% (YTD) and has managed to claw back since dropping to $75,000 back in April, post the tariff announcement. There are a couple of factors that have given Bitcoin this boost.
- Favorable macroeconomic factors like softer U.S. inflation data
- Easing tensions in the U.S.-China trade war
- Moody’s downgrade of U.S. sovereign debt
The cryptocurrency has benefited from both liquidity in the stock market, giving a boost to risk assets, as well as recent risk-off scenarios related to concerns about tariffs and deficits in the U.S. that have driven gains in gold as well as alternative assets like bitcoin. Another factor, chasing the bitcoin bulls, is the legislation in Congress, which could create the first regulatory framework in the U.S. for stablecoins
According to a CNBC report, the cumulative inflows into exchange-traded funds that track the price of bitcoin surpassed $40 billion in the 2nd week of May, and witnessed only two days of outflows in this month.
Since the beginning of the year, there has been a 31% increase in the number of Bitcoin held by public companies, totalling approximately $349 billion, according to Bitcoin Treasuries. This amounts to 15% of the total Bitcoin supply.