Bitcoin has soared to a new high today as investors pour funds into the cryptocurrency.
The world's largest cryptocurrency hit a high of $69,202, topping November 2021's all-time peak of $68,999.99.
Investors have been pouring money into US spot exchange-traded crypto products and the prospect that global interest rates may fall.
Last month, the cryptocurrency was given the green light to be adopted into more mainstream investment products in the US.
Bitcoin hit a high of $69,202
Reuters
CEO and co-founder of crypto platform Anchorage Digital Nathan McCauley said: "The bitcoin all-time high marks a turning point for crypto. Traditional institutions were once sitting out; today, they are here in full force as the principal drivers of the crypto bull market."
The US Securities and Exchange Commission reluctantly approved trading of the first bitcoin exchange-traded funds (ETFs) in early January.
An ETF tracks the price of an asset such as gold, bonds or cryptocurrencies, meaning people can invest without having to buy the asset themselves.
However, the US regulator remained sceptical about cryptocurrencies, saying it "did not approve or endorse bitcoin" in its decision.
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Bitcoin is becoming more mainstream across the UK
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Bitcoin is approaching its next "halving" event in April which limits the rate of new coins being released, and happens roughly every four years.
Experts said the expectation of limited supply alongside growing investor demand has helped inflate prices.
Head of investment analysis at AJ Bell Laith Khalaf said: "The rise in bitcoin has also been galvanised by the launch of spot ETFs in the US, which is seen as a crucial step towards integrating bitcoin and cryptocurrencies into the mainstream financial ecosystem, and potentially paving the way for a global rollout.
"The regulatory approval of these products also adds a layer of legitimacy to bitcoin, amidst concerns raised by policymakers, including in the UK."
But Khalaf said Bitcoin is "largely driven by sentiment" adding: "If you buy some, you’re relying on someone paying more than you further down the line to turn a profit."
Supply of bitcoin is limited to 21 million, of which 19 million have already been mined.
Despite its recent popularity, for many investors, bitcoin is simply too volatile and lacks enough real-world applications to be anything other than a speculative asset.
Yet, in addition to the cocktail of flows of money into ETFs, the prospect of constrained bitcoin supply and an eventual decline in US interest rates, some companies are adding crypto to their corporate coffers.