TOKYO / LONDON (Reuters) – Bitcoin jumped more than 5% on Friday to new records of $ 41,530, reversing early losses.
The world’s most popular digital currency slipped to $ 36,618.36 at the Bitstamp exchange before returning. The ethereum of rival cryptocurrencies has risen by 3% after sinking by more than 10%.
Bitcoin rallied nearly 1,000% from its March low. It exceeded $ 30,000 for the first time on January 2, after exceeding $ 20,000 on December 16.
Some market participants warned of a correction after reaching the $ 40,000 stage, but Bitcoin was ready to record the 11th earnings session of the last 12.
Growing demand from institutional, corporate and, more recently, investors has fueled the growth of bitcoin, attracted by the prospect of rapid gains in a world of ultra-low returns and negative interest rates.
“We see continued growth in demand driven largely by strong and unprecedented institutional interest, which shows no signs of slowing as we move into 2021,” said Frank Spiteri of CoinShares digital asset manager.
JPMorgan strategists wrote on January 5 that digital currency has emerged as a rival to gold and could trade up to $ 146,000 if it is established as a safe haven asset.
Interest in the world’s largest cryptocurrency rose last year, with investors seeing bitcoin as a hedge against inflation and an alternative to the dollar’s depreciation.
Bank of America’s investment strategies said on Friday that “violent” inflationary actions in the markets have helped the Bitcoin rally in the last two months.
But he warned that cryptocurrencies would “throw away previous bubbles”, such as the dotcom bubble in the late 1990s, China in the 2000s and gold in the 1970s.
Chart: Bitcoin versus inflation coverage
Graph: bubble bitcoin
Reporting by Kevin Buckland and Thyagaraju Adinarayan, additional reporting by Tom Wilson; Editing by Himani Sarkar and Hugh Lawson