Bitcoin price hits one-year high

The interest of many financial giants in digital currency has pushed the price of Bitcoin to over $31,400 per coin.

On the night of June 23, Bitcoin price rose above $31,400 per coin – the highest since May 2022. The price then went down, currently around $30,700.

Bitcoin is now the world’s largest cryptocurrency by market capitalization. Earlier this week, the price of Bitcoin rose above $30,000 for the first time since April – when global investors rushed to find safe investment channels after the collapse of two US banks, Silicon Valley Bank and Signature Bank.

Bitcoin price movements over the past year.

The surge could be due to a slew of financial giants taking an interest in cryptocurrencies. According to the US Securities and Exchange Commission (SEC), global asset management giant BlackRock filed an application last week to create a Bitcoin ETF. Cryptocurrency exchange EDX Markets, backed by financial giants Charles Schwab, Fidelity Digital Assets and Citadel, also launched this week.

On Twitter, where much of the discussion about cryptocurrencies takes place, some users have suggested that FOMO — the fear of missing out — is partly responsible for the recent price surge. Some investors are jumping into the market because they see others reaping the benefits of the ongoing rally and want to get in on the action.

Bitcoin has risen 87% this year, with investors hoping the US banking crisis will force the Federal Reserve to halt rate hikes. They have long argued that the digital currency will benefit from a low-interest-rate environment and act as a haven from the turmoil in traditional finance.

However, US authorities have recently tightened control over the cryptocurrency sector. Earlier this month, the SEC sued Coinbase – the largest cryptocurrency exchange in the US – and Binance – the largest cryptocurrency exchange in the world. Both companies were accused of violating various securities and trading regulations.

Bitcoin is also far below its 2021 peak of over $60,000. Last year, the cryptocurrency was hit hard by the Federal Reserve’s interest rate hikes. The cryptocurrency market has also seen the collapse of a series of names, from the stablecoin TerraUSD, the venture capital fund Three Arrows Capital to Sam Bankman-Fried’s FTX exchange.

Furthermore, cryptocurrencies are facing strict regulatory scrutiny. The SEC has maintained a policy of keeping a closer eye on the market following numerous scams and failures of once-vaunted companies.

Low trading volumes are also a risk. In May, total spot and derivatives trading volume on centralized exchanges fell more than 15% to $2.4 trillion, according to CCData. Spot trading volume alone fell nearly 22%, marking its lowest monthly level since March 2019.

Ha Thu - Tieu Gu (according to CNN)

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