For the first time in nearly two years, the world’s largest cryptocurrency has hit its highest level – and the surge appears to have been fueled by the possibility that it could become a mainstream asset.
Bitcoin broke through the $40,000 mark on Monday, December 4th, its value surging by over 5% over 24 hours. According to a report from CoinMarketCap, the cryptocurrency was changing hands at $41,600 per token.
Investors began the frenzy on Friday, December 1st, following an announcement by Jerome Powell, chairman of the US Federal Reserve, wherein he declared that Fed policy was getting into restrictive territory. Many interpreted that remark to mean that the central bank was halting further interest rate hikes, though Powell has stated that these would be imposed again if necessary.
Moving On from the Chaos
Bitcoin’s recent rally is also seen as a reflection of how investors want to shake off the effects of the recent scandals that have plagued the digital asset sector.
According to Antoni Trechev who co-founded digital asset lender Nexo, Bitcoin’s recent breach of the 40K mark may not be as exciting as it was when it first occurred back in 2021, but it’s big news in light of the way it dropped to $15,500 around this time last year. Indeed, this breach is seen as a harbinger of improvements for Bitcoin, as well as the rest of the cryptocurrency scene.
As a possible shot in the arm for the industry, it also dispels the bad taste left behind by recent issues involving major players in the sector. Just last month, Binance founder Changpeng Zhao pleaded guilty to money laundering on a federal scale, prompting him to resign as the cryptocurrency exchange’s CEO.
Zhao entered his plea just a few weeks after the conviction of fallen FTX co-founder Sam Bankman-Fried who was found guilty of orchestrating fraud.