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Home >Markets >Cryptocurrency >Bitcoin surges past $51,000 for the first time ever amid crypto fever

Continuing the rally, Bitcoin jumped again on Wednesday to set another all-time high after breaching $50,000 for the first time a day earlier.

The largest cryptocurrency rose almost 6% Wednesday to about $51,431 after a fivefold surge in the past year, according to a composite of prices compiled by Bloomberg.

The latest leg of the rally, which comes even as India prepares to ban private cryptocurrencies, follows sustained interest from major global institutions.

Bitcoin’s rally for some is emblematic of speculative froth in financial markets awash with stimulus. The crypto faithful counter that the digital asset is grabbing more mainstream attention, especially after Tesla Inc.’s recent $1.5 billion purchase. MicroStrategy Inc. said Tuesday it would sell $600 million of convertible bonds and use the proceeds to buy more of the tokens.

MicroStrategy’s step is “a warning sign if there ever was one that things are getting out of hand in the crypto world," Jeffrey Halley, a senior market analyst at Oanda Asia Pacific Pte, wrote in emailed comments.

Others take a different view, contending that demand from institutional investors and companies is set to expand, driving further gains.

“There are a number of reasons why Bitcoin is soaring, but what stands out most is the trend that MicroStrategy started and Tesla popularised: moving institutional balance sheets into Bitcoin to hedge against inflation," said Nicholas Pelecanos, head of trading at NEM.

Activity in Bitcoin futures suggests traders don’t see a sudden end to the crypto rally, with spreads continuing to widen between the active contract and March futures, according to data compiled by Bloomberg.

Shares of Asian crypto-linked companies are advancing too. Japan’s Monex Group Inc. jumped 11% to hit a 13-year high, while BC Technology Group Ltd. in Hong Kong closed at a record.

JPMorgan Chase & Co. strategists said Bitcoin’s volatility needs to ease to prevent its rally from fizzling. Other commentators see a mania likely to end in a bust akin to the implosion in 2017.

Bitcoin has been barreling through records, scaling another peak above $51,000 on Wednesday. Tesla Inc.’s recent $1.5 billion purchase and MicroStrategy Inc.’s plan to expand its holdings of the token by selling $600 million in convertible bonds added to the buzz around cryptocurrencies. On the flip side, some see a mania likely to end in a bust akin to the implosion in 2017.


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