Bitcoin reaches all-time high following FTX scandal in crypto world

Bitcoin has reached a new all-time high, surpassing $68,800 this week, just above its previous record set in November 2021. The surge in price comes less than two years after the collapse of the crypto exchange FTX, which had severely damaged faith in digital currencies and sent prices plummeting. Despite a brief dip of 4%, the price of bitcoin remains up almost 200% from one year ago.

The recent gains in the price of bitcoin have been fueled by the anticipation and approval of bitcoin exchange traded funds (ETFs) earlier this year. These ETFs provide access to a broader class of investors, and the price of bitcoin has surged about 60% since their approval in January. Additionally, the upcoming bitcoin “halving” event in April is expected to further drive prices up by lowering the supply of new coins.

In January, the U.S. Securities and Exchange Commission approved the first spot bitcoin ETFs from asset managers such as Blackrock, Invesco, and Fidelity. These newly-approved ETFs hold actual bitcoin, unlike previous bitcoin-related ETFs that were invested in contracts related to future price bets. Institutional demand for bitcoin continues to grow, with record inflows of $1.7 billion last week alone.

However, experts caution that investing in bitcoin remains a risky bet due to its volatile nature. While some analysts predict that the constrained supply of bitcoin could push prices higher over time, others warn of significant volatility and the possibility of sizable declines. It is important for investors to exercise caution and be prepared for unpredictable fluctuations in value in the crypto market.

Overall, the recent surge in the price of bitcoin reflects a growing interest in digital currencies, but investors should approach with cautious optimism and be aware of the potential risks involved in investing in cryptocurrencies.


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