Bitcoin hit more than $37,700, a new record high that helped drive the cryptocurrency market beyond $1 trillion, CNBC reported on Thursday (Jan. 7), citing data from CoinDesk and CoinMarketCap.
At about 2:42 p.m. Singapore time, bitcoin was up 5 percent over the day before. Since the start of 2021, the cryptocurrency market is up 29 percent, and in the past 12 months, it is more than 380 percent higher.
“This latest bull run in January is sure to attract the asset managers’ attention to diversify even more of their assets to crypto as they are keen on finding alternative investments, such as cryptocurrency or gold, to hedge inflation and geopolitical risks,” Simons Chen, executive director of investment and trading at cryptocurrency financial services firm Babel Finance, told CNBC.
He added that a lot of new people jumped in to invest, worried they could be missing a good opportunity to “make easy, quick gain from the latest bull run.”
Some bitcoin bulls have called bitcoin “digital gold,” CNBC said, with J.P. Morgan forecasting that the currency could reach $146,000 in the long run.
Other economists are not as confident, with Rosenberg Research strategist David Rosenberg pointing to a bitcoin bubble.
“The parabolic move in bitcoin in such a short time period, I would say for any security, is highly abnormal,” Rosenberg told CNBC.
Over the past dozen months, ethereum also saw record gains, up about 860 percent on Wednesday (Jan. 6) and trading above $1,200, CoinDesk reported.
“The $1 trillion mark cements cryptocurrency as an investable asset class that no longer sits on the fringes of Traditional Finance as a toy for retail investors,” Jack Purdy, decentralized finance analyst at Messari, told CoinDesk. “It demonstrates that this asset class is large enough to absorb large orders like we’ve seen recently with the slew of institutions entering over the last few months.”
The cryptocurrency market includes bitcoin as well as numerous other digital money, such as tether, ripple, and Facebook’s diem dollar, formerly called Libra. Facebook’s Libra Association also renamed itself the Diem Association.
