Continuing its momentum upward, bitcoin, for the first time since November 2021, scaled past $62,000, reaching $64,000.
Crypto enthusiasts around the world, anticipate the rise of the cryptocurrency forerunner to soon, surpass its all-time high of $68,982.20.
According to Coin Metrics, bitcoin briefly reached the $64,000 mark before falling and remaining stable at $61,016.64 approximately 6% from the previous day.
This is good news to traders and investors alike, although the constant sharp price movement has wrecked traders. No side is safe, as both bulls and bears suffer the same fate of losses.
The Bitcoin Surge Drivers
According to the data from CoinGlass, high-volume liquidations occurred within the last 24 hours, with $86 million in long liquidations, while having $176 million in short liquidations.
An explanation of that effect can be viewed from the trader’s perspective. In a situation where traders bet on the rise of the crypto price, and the price goes down, the traders must sell their assets in other to cover up the losses.
Conversely, if the trader goes in the opposite direction and shorts the coin but the price goes up, they would have to purchase bitcoin back from the market right away to close their positions.
By doing so, the demand for the coin increases in a limited supply, thereby elevating the price even further, meaning more positions will undergo liquidation to cover up for losses.
Another phenomenon to look into is the fast-approaching bitcoin halving in April 2024. A process whereby miners would receive half of the current reward for mining a block of the coin.
From another angle, this signifies the reduction in the supply of Bitcoin and the ever-increasing demand for it, which directly increases the price even further.
Then, there are the new U.S. spot bitcoin ETFs that are generating approximately $195 million per calendar day in February 2024, not long after the approval of the bitcoin ETF.
This is without mentioning the Bitcoin network itself, which produces approximately 900 coins per day.
Speculations on Bitcoin show the possibility of the cryptocurrency hitting an all-time high of $100,000 or even double, depending on how investors ride this wave.