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Bitcoin

Bitcoin Surpasses $38,500 and Reaches a New Record High

Central bank and government stimuli have eroded the value of traditional assets such as cash and bonds

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Madrid, 7 Jan (EFE).

Bitcoin, the most widely used crypto-currency, has today reached a new record, above $38,500, driven by the growing interest of institutional investors and by fears of inflation after the considerable stimuli of central banks and governments.

The cryptocurrency, which had been close to $38,000 at first, has reached $38,590, according to Bloomberg. On Wednesday, bitcoin had already marked a historical high by getting to $36,500.

The cryptocurrency has shot up since the beginning of the year. a bitcoin, which had exceeded $29,000 ($29,292) on December 31st, on January 2nd exceeded the barrier of $33,000 ($33,277) and on Sunday approached $35,000 ($34,792).

According to the analysts, these increases respond to the positioning of institutional investors, among them investment banks, that see the possibility of a bitcoin reaching $50,000 in the next few months.

Furthermore, they point out that the expansive policy by central banks, specifically the Federal Reserve and the European Central Bank (ECB), is devaluing the euro and the dollar against bitcoin.

“The demand for alternative assets is increasing and institutions around the world are seeing bitcoin as a growth asset and as a way to protect themselves against the great fear of 2021: inflation,” explains Simon Peters, analyst of the investment platform eToro.

According to Peters, central bank and government stimuli “have eroded the value of traditional assets such as cash and bonds.”

In his opinion, although bitcoin will continue to be a volatile asset, its price will remain high. “There will be volatility, which is natural after the gains we have seen, but the long-term trend is clear,” stresses Peters.

On December 16th, bitcoin surpassed the $20,000 level for the first time and reached $21,295. Since then, it has not stopped rising.

On December 19th, it surpassed the $24,000 barrier; on December 26th, it shot up to almost $27,000; and, one day later, it surpassed $28,000.

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