Bitcoin Breaks $50,000, Jumps to All-Time High
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- Bitcoin peaks above $50,000 as the crypto market remain hot
- Dogecoin slips nearly 50% following Elon Musk tweets
Bitcoin broke another barrier on its move to the upside as the cryptocurrency frenzy continues. On Wednesday, the number one digital coin set another all-time high, after it peaked above the $50,000-mark one day earlier. Bitcoin rose as much as 4.5% on Tuesday and today it’s trading over $51,000. The recent spike in the price of bitcoin comes as a result of the large-scale adoption that has been keeping the trend going for the last few months.
Bitcoin’s rally has shot the price 75% higher this year alone and more than 300% in the previous year. The stratospheric gains continue to polarize the public as bitcoin keeps turning heads. On the one side, opponents say the rise is purely a speculative activity in an environment awash with hopes. For the crypto proponents, however, the appreciation of the asset is a fair reflection of growing mainstream adoption. The crypto world now enjoys Tesla’s support after the EV maker announced the purchase of $1.5bn worth of bitcoin. Critics argue that Elon Musk, one of bitcoin’s strongest promoters, turns a blind eye to the environmental impact of producing it.
Adding to the bitcoin buying frenzy, MicroStrategy maintains its interest in bitcoin. As it said on Tuesday it plans to sell $600 million of convertible bonds to buy more cryptocurrency. The business software company spent over $1bn on bitcoin in 2020 to purchase 70,469 bitcoins, according to their 10-K filing with the Securities and Exchange Commission.
Bitcoin Goes Mainstream?
While bitcoin supporters say that demand from institutional investors and companies will continue to expand, risks remain present as the crypto mania dominates the spotlight. The wild swings in price action have become a daily element of bitcoin’s behavior.
Another drive of bitcoin’s price, according to some analysts and investors, has been the looming fear of inflation as the US stimulus is being prepared to soften the damage done to the US economy. Many are cheering for bitcoin to become mainstream as a way to hedge against inflation and a weak US dollar.
Staying on the crypto topic, the largely favored coin by the community, Dogecoin, has slipped nearly 50% from its all-time high reached earlier this month. The digital asset, created as a joke by its two founders, depreciated on comments by Elon Musk. The Tesla chief, who’s been a vocal supporter of Dogecoin, said the concentration of the coins in circulation is too high. In a tweet, he urged “major Dogecoin holders to sell most of their coins”. In a follow-up tweet, Mr. Musk said he will “literally pay actual $ if they just void their accounts”.
Dogecoin reached an all-time high of $0.085, boasting a market cap of nearly $11bn, which even one of its founders, Billy Markus, “cannot comprehend”. In an open letter to the Reddit community, Mr. Markus wrote about the cryptocurrency he created years ago. He refrained from answering whether Dogecoin can reach the price level of $1, but he stated that the true value of Dogecoin is “joy, kindness, learning, giving, empathy, fun, community, inspiration, generosity, silliness, absurdity”. In a recent tweet, he said he sold “all doge after getting laid off and freaking out about money”, continuing that he “made about enough to buy a used Honda Civic”.
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