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After a little over two years, a lot of blood and sweat, and a brutal winter that saw its price touch the $15,000 price handle, Bitcoin has now officially reached a new all-time high, vindicating its proponents in the process and giving a memorable bloody nose to its detractors.
BITCOIN REACHING ALL TIME HIGH BEFORE REVERSING
A MAJOR sell-order was placed at all-time-high levels.. It was pretty visible and @MadsEberhardt called the price action 100% correct for our clients pic.twitter.com/MstvXD1bde
— AndreasStenoLarsen (@AndreasSteno) March 5, 2024
Just moments ago, Bitcoin traded at the $69,200 price level, constituting a new all-time high. The world’s pre-eminent cryptocurrency last traded at these lofty levels in November 2021, when it had topped out at the $68,991 price level. While the cryptocurrency fell back quickly, this is likely to be temporary as the move was a result of a large sell order placed at the previous all-time high price level.
Over the last two years, Bitcoin contended with the fall of Terra and FTX, the Federal Reserve’s fastest interest rate hiking cycle on record, the SEC’s confounding hostility towards the nascent crypto sphere, and a veritable onslaught of obituaries in the mainstream media as the world’s largest cryptocurrency by market capitalization plummeted hopelessly toward the $15,000 price level. Yet, like a phoenix emerging from its own ashes, Bitcoin survived these crises and emerged stronger than ever, courtesy of a global community of hardcore enthusiasts who refused to yield an inch even when battered by a maelstrom of turbulence.
every critic who called bitcoin a bubble or “tulip mania” needs to take a long hard look in the mirror
the supposed “tulip mania” didn’t happen 4 times, each from a way higher base
admit you were wrong and salvage what’s left of your credibility
— Alex Thorn (@intangiblecoins) March 4, 2024
Bitcoin’s ongoing rally is currently being driven by two thematic plays. First, as we’ve been noting ad nauseam, the recently launched spot Bitcoin ETFs in the US are now creating a vicious bout of scarcity in the market, soaking up a quantum of coins each day that far exceeds the oncoming supply via mining activities. Secondly, this scarcity-driven market is set to experience a veritable dust bowl in April 2024 when Bitcoin undergoes its next halving event, and the reward for mining a block is cut in half to just 3.125 BTC.
Wall Street firms continue to file for Bitcoin ETF exposure in their in-house investment funds. You’re going to see a lot of this in coming months. After the close of trading today, BlackRock filed with the SEC for its Strategic Income Opportunities Portfolio:
“The Fund may…
— MacroScope (@MacroScope17) March 4, 2024
In a development that is sure to increase the demand for spot Bitcoin ETFs, BlackRock is now seeking to invest its own funds in these “exchange-traded products.”
So, what happens next? Well, Bitcoin is still quite far from price levels that would typically scream a stretched valuation, judging by the cryptocurrency’s MVRV Z-Score, which has been pivotal in identifying all previous cycle highs.
“I think Bitcoin makes a beeline back towards its long-term trend line, which is probably $82,000 in the near term, $150,000 before year-end,” says @fundstrat‘s Tom Lee as $BTC closes in on its all-time high. pic.twitter.com/g4p6VOTECx
— Last Call (@LastCallCNBC) March 5, 2024
Based on Bitcoin’s current momentum, it can certainly hit the $100,000 price level within the next few months. In fact, Fundstrat’s Tom Lee expects Bitcoin to close the year at a price of around $150,000.
Yet, some analysts, such as André Dragosch, ETC Group’s head of research, are now openly calling for Bitcoin to usurp the primacy of Gold as the premier safe-haven asset. Based on the two assets ‘ stock-to-flow ratios, Dragosch posits that Bitcoin will become double as scarce as Gold in the post-halving phase. Consequently, the analyst contends that the world’s pre-eminent cryptocurrency will eventually overtake Gold’s AUM. To do so, however, Bitcoin will have to reach a price level of around $600,000.