Bitcoin Hits Record High
Bitcoin, the biggest cryptocurrency by market cap, hit an all-time high yesterday.
The coin climbed as high as. $67,000, beating April’s record of $64,000.
What Caused the Price Pump?
The launch of the first Bitcoin Exchange Traded Fund (ETF) in the US (ProShares Bitcoin Strategy ETF — BITO) spurred this price movement.
An ETF is likened to a basket of different investment assets sold on an exchange, as a single investment asset. It tracks the performance of a group of underlying assets. In the case of a Bitcoin ETF, the underlying asset is Bitcoin.
The BITO ETF is a futures ETF.
Bitcoin futures contracts are financial instruments where two parties enter into an agreement to buy or sell Bitcoin at a predefined price at a later date.
What Does the Future Hold?
Year-to-date, Bitcoin has gained 111.43%.
That is, a sum of ₦100,000 invested at the beginning of the year, would now be worth ₦211,430.
However, it is worth mentioning that a similar price pump which occurred in April this year dipped by about 30% in less than two weeks after.
This is to emphasise the price volatility that colours the Bitcoin and cryptocurrency market in general.
We’ll possibly see a further increase in price as we anticipate the launch of a second Bitcoin ETF (The Valkyrie Bitcoin Strategy fund) anytime from now.