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Bitcoin rose above the $ 51,000 level for the first time on Wednesday.
The red cryptocurrency hit a new record price of $ 51,715 at about 4:50 a.m. ET, according to Coin Metrics. The latter traded 5% higher at $ 51,228.
Bitcoin was created in 2009, not long after the global financial crisis. It has gone from a protest against the banking system to something “digital gold” that is beginning to catch on with ordinary investors.
On Wall Street, the big investment banks seem to be heating up on bitcoin. JPMorgan recently said it is seriously looking at the asset class, and Goldman Sachs has also shown interest in crypto. A division of Morgan Stanley is considering adding bitcoin to its list of possible bets.
Companies like PayPal and Mastercard have made significant moves to support cryptocurrencies. And Tesla said last week that it had invested $ 1.5 billion in bitcoin and planned to accept digital currency as payment for its products.
The latest Bitcoin rally reminded many investors of its massive rise to nearly $ 20,000 in 2017, which was followed by a dip the following year, which saw the digital currency lose 80% of its value.
But the world’s most valuable cryptocurrency has had a sharp recovery since then, more than fourfold in 2020 and gained more than 70% this year.
Bitcoin supporters say it is due to increased demand from institutional investors, as well as the corporate purchase of digital currency from Tesla, Square and MicroStrategy. Skeptics, on the other hand, are worried that bitcoin may be the biggest balloon on the financial markets.
JPMorgan strategists warned on Tuesday in a note that unless bitcoin volatility begins to decline, its current price “seems unsustainable.” Bitcoin and other cryptocurrencies have earned a reputation for their extreme price fluctuations.