BITCOIN IN ORBIT
Rockets beyond $65,000
Bitcoin blasted past the $65,000 mark on Wednesday morning to set a new record high.
The digital coin passed the all-time milestone Wednesday morning. It continued to motor ahead and later in the day was trading north of $66,900, according to Coinbase data.
The development marks a dramatic reversal for bitcoin, which previously set a record just shy of $65,000 in April before plummeting over the summer and falling as low as $29,800 in July.
Bitcoin largely recovered this fall, gaining a significant boost this week when federal regulators allowed the first exchange-traded fund containing futures based on the cryptocurrency to start trading Tuesday.
More bitcoin futures ETFs from asset managers like ARK Invest and VanEck are expected to start trading in the coming weeks.
The inclusion of bitcoin futures in ETFs could push the cryptocurrency even further ahead, some crypto-watchers said.
“People want the convenience of owning bitcoin in their brokerage accounts, and there’s probably been a lot of capital sitting on the sidelines waiting for that product to exist and now it does,” said Garrick Hileman, research chief at Blockchain.com.
Still, there could be some warning signs flashing, Hileman told The Post. The current rally could go down in flames — just like the last time the digital coin set the previous all-time record in April.
He warned that much of crypto’s recent hot streak has been driven by short-term speculators using leveraged borrowing. Interest rates on crypto loans have doubled over the past week — a telltale sign of rampant speculation.
“We saw those levels in the spring around bitcoin’s previous all-time high — and that proved unsustainable,” said Hileman, who’s also a fellow at the London School of Economics.
Even with its volatility, Hileman says bitcoin makes for a good investment in the medium- to long-term as it gains steam among institutional investors.
“Right now things are rocketing up and crypto assets are very volatile and might reverse, but if you have a longer-term perspective and put in a modest sum you’re not going to wreck yourself,” he said. “Now is a perfect time to get in if you’re brand new to crypto assets.”
Since 2013, bitcoin has surged more than 62,000 percent, according to Coinbase data.
Meanwhile, ethereum, the secondmost popular cryptocurrency after bitcoin, also saw a hefty boost on Tuesday, passing the $4,000 mark for the first time since May.
Increased interest in crypto from old-guard asset managers and investors means that the most-accessible coins — bitcoin and ethereum — will outperform more obscure “altcoins” like the dogecoin or litecoin in the short-term, Hileman predicted.
As for bitcoin, it’s surged 41.2 percent over the past month alone.
David Sacco, a finance professor at the University of New Haven and an ex-UBS investment banker, said that he expects bitcoin to fall again in the near term.