Well-known companies that have adopted it as a payment method have backed Bitcoin, whose value has more than tripled since the end of last year.
However, some analysts said the latest increase was partly due to the huge US stimulus that was approved this week.
The total market value of Bitcoin last month exceeded $ 1 trillion.
However, Bitcoin has a history of strong price fluctuations and has fallen dramatically many times since its inception in 2009.
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Large corporations have driven the recent increase.
In February, Elon Musk revealed that his electric carmaker Tesla would buy $ 1.5 billion worth of Bitcoin and accept it as car payment in the future.
MasterCard is now planning to accept certain cryptocurrencies as a payment method, but BlackRock, the world’s largest asset manager, is looking for ways to use digital currencies instead.
The Covid-19 pandemic also affected the rise in Bitcoin prices. This is because more and more people are buying online, away from physical coins and bills.
Critics argue that Bitcoin is not a currency, but a speculative trading tool open to market manipulation.
There are also concerns about environmental impacts, such as the need for large amounts of power for transactions.
Cryptocurrency (virtual currency) Bitcoin remained firm, maintaining the $ 60,000 level in trading on the morning of the 15th Asian time. Weekend trading hit a record high of $ 61,742, surpassing $ 61,000 for the first time with the expectation that additional economic measures in the United States would be a tailwind to pursue the upside. It has fallen slightly from this level.
In addition to speculative demand, Bitcoin has risen at a pace of over 1000% over the past year due to favorable signs of increasing interest among institutional investors and companies as an investment target.
Pepper Stone Group Research Officer Chris Weston of the report, pointed out that “some of the desired flow in the form of anticipating the trader to the influence of the cash benefits of the US additional economic measures” can be seen, “a new bullish It is necessary to stay above the previous high of just over $ 58,000 to increase confidence in the market.
Matt Mayley, chief market strategist at Miller Tabak, predicted that Bitcoin could rise “very quickly” towards $ 75,000, based on some chart patterns.
Bitcoin, a crypto asset (virtual currency), fell 1.78% on the 14th to $ 60, 0077.32.
It was down 2.8% from the record high of $ 61,781.83 on the 13th.
Market participants had the opposite view when Fed Chair Jerome Powell dismissed inflation concerns last week.
In short, the recent rise in US 10-year government bond yields and the so-called “break-even inflation rate,” an indicator of expected inflation, reflect growing interest in the outlook for economic growth, but at the same time prices. It also reflects concerns about the possibility of an accelerated rise.
This problem is also a huge problem for Bitcoin traders. That is because many traders believe Bitcoin will be a potential risk hedge against inflation caused by the trillions of dollars the Fed has dropped as a countermeasure against the new coronavirus.
On March 10, the Bureau of Labor Statistics of the US Department of Labor will release the Consumer Price Index (CPI) for February. Bitcoin traders will be aware of rising inflationary pressures.
According to Fact Set, which handles financial data, economists and analysts predict that the CPI has risen 1.7% in the last 12 months, accelerating from 1.4% last month.
Core CPI, excluding volatile food and energy, is expected to rise 1.4% year-on-year, about the same as January. These growth rates are still considered low, but future inflation expectations are rising.
According to a February household survey conducted by the Federal Reserve Bank of New York, consumers’ expected inflation rate one year later has risen to 3%, the highest level since July 2014.
“Inflation risk is biased upwards,” according to a report released by Deutsche Bank on the 7th.
According to Deutsche Bank, a surge in inflation-adjusted yields on US Treasuries represents the risk of unexpected monetary tightening and could pose challenges to the market. “For the time being, we see the market as having limited potential to accelerate the timing of monetary tightening.”