Bitcoin’s market capitalization reached a high of $18,062 at 3:01 UTC, a price point not seen since December 16, 2017.
After peaking at almost $18,500, prices dropped back below $18,000 for about two hours before crossing the level again.
In the last 24 hours, Bitcoin has ranged from $16,560 to $18,464.
Bitcoin’s capitalization (BTC, +8.15%) has risen 146% so far this year and gained almost 70% so far this quarter, according to data from CoinDesk 20.
“Some recent events have certainly had an impact,” said Antoni Trenchev, co-founder and managing partner of the lender Nexo.
“Institutional investment by companies such as MicroStrategy and Square, PayPal which has been actively engaged in cryptography and the reduction by half of the bit currency in May” were the likely causes of the continued increase in bit currency.
Influence of the Pandemic
Others see global events like COVID-19 and negative interest rates in traditional markets, like Germany, as outliers for this year’s meteoric Bitcoin capitalization.
“Interest rates are the most important factor in people’s decisions about where to put their money,”; said Ki Young Ju, CEO of the analytical firm CryptoQuant. “I am confident that negative interest rates will drive adoption at Crypto, either by purchasing crypto/index funds directly or by using betting services”.
While Bitcoin’s capitalization is rapidly approaching its historic high of $19,666 on December 17, 2017, the ether also reached new heights in 2020, rising above $488 to $489 at press time.
Another factor could be attributed to the central banks’ easy money policies and the increase in government spending in some of the world’s largest economies, including Europe and the United States, in recent months.
“I think it basically boils down to monetary and fiscal policy,” said Kyle Davies, co-founder of Three Arrows Capital. “Central banks can lower rates until they become slightly negative, and then they have to print money”.
At that point, Davies argues, central banks’ reliance on freshly printed money will make “BTC attractive.