Unable to find a top, Bitcoin rose to nearly $ 55,000, officially cap 1 trillion

The coin was trading below $ 54,000 and rose to a high of $ 54,880 later in the Feb. 19 session (as of 23:00 Vietnam time), according to Coin Metrics. Accordingly, Bitcoin’s capitalization reached $ 1 trillion for the first time. This is a milestone that helps the digital currency record returns far beyond other traditional assets such as stocks and gold.

The world’s largest digital currency has recorded an additional $ 450 billion in value in 2021, to $ 1 trillion, according to data compiled by Bloomberg. The Bloomberg Galaxy Crypto Index – which tracks both Bitcoin and four other cryptocurrencies, has more than doubled.

Bitcoin’s capitalization skyrocketed to $ 1 trillion.

Speculators, chief capitalist of businesses and institutional investors are said to have fueled Bitcoin’s impressive rally.

Bitcoin proponents are still arguing with skeptics as to what is the driving force behind this rise. One group said Bitcoin is an asset that many people have embraced because of its ability to hedge risks such as inflation. Meanwhile, the other group realized that this was just a temporary, precarious psychology at the “top” of the wave of financial and monetary stimulus.

In agreement, this debate also argues that capitalization is not an exactly representative factor, because Bitcoin is not a company or even an asset. Without the physical assets owned by businesses or backed by the government like the dollar, all investors buy is only trust in the crypto network, the skeptic group said.

This year, Bitcoin has recorded much more impressive gains than stocks and commodities.

However, Shane Oliver – Head of Investment Strategy of AMP Capital Investors Ltd. in Sydney, said FOMO sentiment is overwhelming. He added: ” At a time when it is easy to make money like now, such a move is even more accelerated and it is part of the driving mentality of investors .”

This month, Tesla revealed a $ 1.5 billion investment in Bitcoin. Meanwhile, MicroStrategy Inc. accelerate the sale of convertible bonds worth $ 900 million to buy more Bitcoin. These moves have brought Bitcoin closer to American businesses.

Craig Erlam, senior market analyst at Oanda Europe Ltd., said: ” If the fundamentals of businesses become more attached to the movement of Bitcoin because they suddenly become speculators. We’ll be in a bubble before we realize it . ”

On February 19, Elon Musk continued to post a puzzling tweet, with the aim of “defending” Tesla’s move to buy Bitcoin. He said Bitcoin ” is simply a form of liquidity that is less silly than cash “, while adding that the electric car maker’s decision does not directly reflect his opinion.

According to a February survey by the fund management division of Bank of America, “buying Bitcoin” is considered one of the largest transactions in the world, along with buying technology stocks and short selling copper. USD.

If Bitcoin ” ceases to be popular – government regulation or investors simply switch to another type of investment, for example, then the coin could quickly break off ,” said AMP’s Oliver. slope . ”

Consult Bloomberg