Bitcoin hits new high above $39,000 as crypto market passes $1tn

Oscar Williams-Grut
·Senior City Correspondent, Yahoo Finance UK
·2 min read
Tokens bearing the bitcoin logo. Photo: STRF/Star Max/IPx/AP
Tokens bearing the bitcoin logo. Photo: STRF/Star Max/IPx/AP

Bitcoin’s (BTC-USD) relentless march higher continues.

The world’s biggest cryptocurrency broke through the $37,000 (£27,000), $38,000, and $39,000 marks for the first time ever on Thursday, repeatedly reaching new all-time highs. Just 24 hours earlier bitcoin had passed $35,000 for the first time.

By 4.10pm London time on Thursday, bitcoin was up 4.8% to $39,384.16.

The rally helped propel the wider cryptocurrency ecosystem to another milestone. The total value of all tokens and coins in circulation topped $1tn for the first time on Wednesday night, CoinDesk reported.

Naeem Aslam, chief market analyst at Avatrade, said chaos on Capitol Hill in the US helped to support bitcoin’s price. Trump supporters stormed the senate in chaotic scenes that left four people dead, according to the BBC.

READ MORE: Markets unfazed by attack on US Capitol

However, others said the rally was unrelated.

“I doubt it has anything to do with the situation playing out on the hill,” said Mati Greenspan of Quantum Economics. “Momentum has been building over time, and it's anyone's guess where or when we might eventually top out.”

Many bitcoin evangelists argue bitcoin is a “safe haven” asset akin to gold and instability tends to support the price. Bitcoin’s underlying code means there is a finite supply of the token, which proponents argue supports its value due to scarcity.

“In a year dominated by coronavirus, mounting debt and volatility in equity markets, investors have started to turn their attention to some of the qualities that makes bitcoin such an attractive proposition,” said David Mercer, chief executive of cryptocurrency and foreign exchange trading group LMAX. “In short, it offers a store of value, not unlike gold.”

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Bitcoin has rallied strongly over the last three months, rising more than 200% since the start of October. The rise has coincided with a new wave of institutional interest in the cryptocurrency. Square (SQ) has publicly invested in bitcoin and PayPal (PYPL) now allows customers to handle the token through its platform.

The price of bitcoin has risen rapidly over the last three months. Photo: Yahoo Finance UK
The price of bitcoin has risen rapidly over the last three months. Photo: Yahoo Finance UK

Aslam said bitcoin was “surely and clearly heading towards the next important price level, which is $40K.”

“A real bull rally has only begun,” he said.

WATCH: Why Bitcoin’s latest surge is different from its 2017 rally