Bitcoin is still the market’s runaway success story of the year. The cryptocurrency topped $30,000 on Tuesday for the first time since June.
Bitcoin has gained more than 80 percent in price so far this year, far outperforming many other assets. The Nasdaq 100, an index of the biggest tech stocks, has gained roughly 20 percent in that period — a strong showing but a far cry from Bitcoin’s resurgence.
The latest Bitcoin rally appears to be partly tied to the Federal Reserve’s monetary policy, which has included nine interest rate increases over the past year. Crypto asset prices sunk a year ago as the central bank began to raise rates, but investors are now betting that the Fed will soon pause its rate increases, even though Fed officials have been suggesting the opposite, setting off a big rebound.
Bitcoin’s biggest gains also coincide with the turmoil in the banking sector. The cryptocurrency is up more than 45 percent since the collapse of Silicon Valley Bank last month. Industry advocates point to the recent rally as a sign that investors are converting some of their cash into digital currencies, though there is little evidence of that happening.
Michael J. Saylor, the executive chairman of MicroStrategy, a software company that has been on a Bitcoin buying spree in recent years, celebrated the $30,000 milestone: “#Bitcoin is Champion,” he tweeted.
As of last week, MicroStrategy held about 140,000 Bitcoins, which is worth about $4.2 billion at current prices, eclipsing the firm’s $3.6 billion market capitalization.
Bernhard Warner
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