Bitcoin Breaks $50K Level, Highest Since 2021

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Bitcoin broke the $50,000 resistance level earlier today around 11:00 AM EST, the first time it has done so since December 2021.

While this action marks a milestone for crypto in general, selling from major exchanges such as Binance and Coinbase has kept the alpha cryptocurrency's price movement at a slightly slower pace.

The price rally comes at an opportune time: Roughly a month ago, 11 spot Bitcoin ETFs were approved by the Securities and Exchange Commission in the US, albeit with significant turbulence.

For historical context, Bitcoin was trading at less than half of what it was last year: BTC It was playing around $22,000 as 2023 began, with the crypto industry unable to extricate itself from the wreckage of the 2022 crash.

According to data from CoinShares, digital asset-backed investment products brought in $1.1 billion, bringing year-to-date revenue to $2.7 billion. From this number, Bitcoin is represented More than 98% of revenues.

The recent price increase shows growing confidence in the crypto markets. That proposal came under fire nearly two weeks after the ETF's approval, when one of the biggest cryptocurrency asset managers, Grayscale, sold bitcoin to Coinbase, transferring more than $2.2 billion in that time. This selling pressure has pushed the price of Bitcoin lower. However, grayscale sales seem to have slowed, allowing prices to stabilize and rise again.

Meanwhile, ETF products from BlackRock ( IBIT ) and Fidelity ( FBTC ) saw their highest after-hours trading volume since Jan. 22. Share prices of these ETFs rose 5 percent today when the markets opened.

The acceleration of institutional investment in ETFs and other developments in the institutional crypto sector has been cited as a key driver of new momentum for Bitcoin.

The resurgence of the tech industry after the challenges it faced after Covid-19 (silicon shortages, supply chain issues, etc.) is seen as a big factor. Surprisingly, Bitcoin has Separated from the Nasdaq-100 index For the first time in four years.

Another driver of Bitcoin's recent price performance is the “halving” event that is expected to happen sometime in April of this year. By halving, the scarcity of Bitcoin will be pushed, the idea of ​​Bitcoin to be protected against inflation and the value proposition will be promoted as a depreciable asset.

While Bitcoin will show huge gains in 2021, with its all-time high above $69,000, its trajectory is highly dependent on positive momentum and attracting institutional capital.

At the time of writing, Bitcoin is trading at $50,220 (based on CoinGecko data). If the interest rate is reduced again, the price can easily change course. For now, however, a retracement above the $50,000 level signals a triumphant return for the alpha cryptocurrency.

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