After stumbling out the gates in 2022, the leading cryptocurrency bitcoin has turned its negative year into a positive all in the first quarter alone. Even with inflation and geopolitical factors affecting the capital markets, bitcoin has proven its mettle.
After hitting a high of $69,000 back in November 2021 amid high institutional investor interest and the introduction of a bitcoin futures exchange traded fund, the leading cryptocurrency fell as much as 25% in 2022. On January 23, bitcoin was trading around just $35,000 or almost half the high of last November.
It’s worked its way past $48,000, and institutional money is once again eyeing bitcoin and the cryptocurrency market in general. Hotshot investors like Ray Dalio are looking into a crypto fund, as digital assets are once again in vogue.
“The ongoing capital splash into the digital currency is a sign that investors do not want to take a back seat in a price movement that could push bitcoin to a height not seen since November 2021,” said Alexander Mamasidikov, co-founder of the mobile digital bank MinePlex.
Crypto Showing Resilience and Relevancy
In its nascent stages, bitcoin was and for the most part still is a volatile asset. However, that volatility has lessened within the last few years, giving rise to the leading cryptocurrency and granting the crypto market as a whole more acceptance within traditional finance circles.
“Throughout the last six months, crypto has shown its resilience and relevancy, even as strong macroeconomic headwinds have disrupted traditional markets by remaining within range. Now, crypto is center stage with its biggest opportunity to shine,” said Chris Kline, chief operating officer and co-founder of Bitcoin IRA, to CNBC.
“Crypto is not trading in a vacuum,” Kline added. “Geopolitical uncertainty, inflation, and a serious potential for a recession are giving both retail and institutional investors a reason to build a defensive strategy. Crypto is playing an integral role in that plan.”
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