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Bitcoin hits $50,000 level for first time since 2021

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Published Time: 12.02.2024 - 22:41:04 Modified Time: 12.02.2024 - 22:41:04

As ever for bitcoin's spot price, values have been volatile this year but analysts say there have been several factors behind its recent recovery and believe its looming "halving" event could help further

As ever for bitcoin's spot price, values have been volatile this year but analysts say there have been several factors behind its recent recovery and believe its looming "halving" event could help further.

Business reporter @SkyNewsBiz

Monday 12 February 2024 18:46, UK

Bitcoin has returned to the $50,000 level for the first time since December 2021, riding on the coat tails of a wider rally for US stocks.

The world's largest cryptocurrency, which hit one-month highs last Friday, maintained its momentum on Monday by rising almost 5%.

Rivals, such as ether, saw similar percentage moves.

Analysts credited several factors for recent crypto gains, saying that wider market sentiment was benefiting from growing expectations of central bank interest rate cuts.

The prospect of cheaper borrowing costs ahead helped the S&P 500 and Dow Jones Industrial Average to record intraday highs earlier in the day.

The tech-focused Nasdaq was just shy of breaking through its best-ever level.

Bitcoin's recovery from a wave of scandals, including the fraud-driven bankruptcy of the FTX exchange, was aided last month when US regulators backed the creation of 11 exchange-traded funds (ETFs).

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These are investment products based on market prices that allow investors to gain exposure to bitcoin without owning the currency directly.

The Securities and Exchange Commission's decision was seen as giving cryptocurrencies a form of official legitimacy for the first time, despite deep scepticism remaining over the lack of wider rules and oversight.

The body is currently reviewing applications for ETFs linked to ether's spot price.

Bitcoin values were hurt by a wave of ETF outflows earlier this month but the price wobble ended on Friday when they were reported to have been replaced with net inflows.

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The news helped leave bitcoin more than 10% up on the start of the year.

It topped $50,196 on Monday evening, according to LSEG data.

The all-time high for bitcoin's value came in November 2021 when it exceeded the $65,000 level.

Analysts said the recent surge in value was also attributable to the next bitcoin "halving" event, expected in April.

That process is designed to slow the release of bitcoin, whose supply is capped at 21 million tokensof which 19 million have already been created.

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