Home Economy Bitcoin nears USD 50000, Wider adoption fuels record rally

Bitcoin nears USD 50000, Wider adoption fuels record rally

Bitcoin nears USD 50000, and hits a new record high on Sunday, as Wall Street and Main Street increasingly adopt the world's biggest cryptocurrency.

Bitcoin nears USD 50000

February 15, 2021: The world’s largest cryptocurrency, Bitcoin nears USD 50000 approximately. It has reached about $49,344 earlier in the day and was around $49,202 as of 10.20am in London.

Bitcoin recently stood at $48,800 on Sunday morning, up 3.2%. It had traded as high as $49,714 earlier in the day. The cryptocurrency is up around 70% year to date.

After long being shunned by traditional financial firms, bitcoin and other virtual currencies appear to be increasingly entering the mainstream as an asset and routine payment vehicle.

Bitcoin, which was trading at around $7,000 per coin at the beginning of 2020, topped $40,000 in January this year and has gone mainstream, as billionaire investors revealed their stakes in it and PayPal began letting customers buy and sell coins directly from their accounts. 

Even with its huge price fluctuations, the virtual currency has surged overall while the yield for junk bonds dipped below 4% for the first time ever — suggesting that investors may consider the cryptocurrency a legitimate alternative.

Bitcoin nears USD 50000, popularity of this cryptocurrency makes it an acceptable mode of payment in 2021

BNY Mellon said last week it formed a new unit to help clients hold, transfer and issue digital assets, just days after Elon Musk’s Tesla revealed it had bought $1.5 billion worth of the cryptocurrency and would soon accept it as a form of payment for its cars. 

On Friday, Canada’s Ontario Securities Commission approved the launch of Purpose Bitcoin ETF, Toronto-based asset management company Purpose Investments Inc said in a statement.

The OSC confirmed it had cleared the launch of the world’s first bitcoin exchange-traded fund, in a separate statement to Reuters. Mayor Francis Suarez of Miami also said on Friday the Florida city is seeking to embrace bitcoin in its operations, a move that could bring dividends in terms of attracting technology companies.

In January, BlackRock Inc, the world’s largest asset manager, added bitcoin as an eligible investment to two funds.

Credit card giant Mastercard’s plans to offer support for some cryptocurrencies also boosted bitcoin’s ambitions towards mainstream finance, though many banks remain reluctant to engage with it.

Rising value might be owed to rising Cryptocurrency acceptance

Cryptocurrency miner Riot Blockchain rose 14% on Friday and hit its highest in over 10 years with a weekly gain of 110%, its biggest weekly gain since 2017. Digital asset tech company Marathon Patent Group showed a weekly gain of over 70%.

Bitcoin has been buoyed in recent months by endorsements from the likes of Paul Tudor Jones and Stan Druckenmiller.

 Bloomberg reported earlier that Morgan Stanley may bet on Bitcoin in its $150 billion investment arm, following news late last week that BNY Mellon plans to service cryptocurrencies for its clients. And that’s after Tesla Inc. put about $1.5 billion into Bitcoin. 

However, skeptics warn the asset class could be in a bubble.

“With each major announcement like the one BNY Mellon made, other institutions are spurred to more rapid adoption and deployment of digital assets,” said Patrick Campos, Chief Strategy Officer at Securrency, a developer of blockchain-based financial and regulatory technology, on Friday.

“Tesla’s recent announcement will embolden other large corporates and institutions to accept crypto as not just a worthy asset class, but perhaps even an essential one. More important, is the corresponding build-out of institutional services to support these developments will trigger other digital assets-related developments within those institutions and in the larger ecosystem.”

Also Read: Electric car maker Tesla invested in Bitcoin

Written by: Sugyani Mohapatra

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