Bitcoin surged again on Wednesday, bouncing back from a brief dip after reaching an all-time high less than 24 hours earlier. The bullish sentiment remained strong for the world’s largest cryptocurrency, with investors showing little inclination to pull back their bets.
During the Asian session, Bitcoin saw a 5% jump to hit an intraday peak of $66,540 in volatile trading, coming close to Tuesday’s record high of $69,202. It maintained a 4% increase, trading at $65,946.
The remarkable rally of the digital asset, which has already seen a 55% surge since the beginning of the year, has been fueled by investors pouring funds into U.S. spot exchange-traded crypto products. Additionally, the prospect of global interest rates decreasing has contributed to the bullish sentiment.
According to Lennix Lai, the global chief commercial officer at crypto exchange OKX, the rally is supported by ETF flow and an optimistic outlook that includes an Ethereum upgrade and bitcoin “halving,” which slows down the production of new bitcoins.
Lai added, “The trend also indicates an elevated level of mainstream acceptance of bitcoin, perhaps more than ever before.” The approval of 11 spot bitcoin ETFs by the U.S. Securities and Exchange Commission in late January marked a significant moment for the industry after an 18-month crypto winter marred by high-profile bankruptcies and scandals.
Even institutional investors, who were previously wary of the token due to its volatile nature, are now committing long-term investments, potentially sustaining the ongoing rally.
The positive sentiment surrounding bitcoin has also influenced other cryptocurrencies, with Ethereum, the second-largest cryptocurrency, up more than 60% for the year and trading at $3,750, a 6.4% increase.
However, skeptics caution against the speculative nature of these assets. After reaching a record high on Tuesday, bitcoin experienced a sharp reversal, falling by more than 10% below the $60,000 level.
Matt Simpson, senior market analyst at City Index, commented, “That looks like classic bitcoin behavior – it chews you up then spits you back out. A pump and dump to previous record highs wiped out some weaker hands, and I suspect we’re now in the volatile and erratic phase we usually see when it reaches a record high.”
