Bitcoin breaches $34,000 as rally extends into new year
Bitcoin, the world’s largest cryptocurrency, topped $34,000 just weeks after passing another major milestone.
The currency gained as much as 9.8% to $34,792.48, before slipping to about $33,500 as of 3:05 p.m. Sunday in London. It advanced almost 50% in December, when it breached $20,000 for the first time.
The latest gains top an eye-popping rally for the controversial digital asset in 2020, which rebounded sharply after a severe crash in March that saw it lose 25% amid the COVID-19 pandemic.
The currency “will be on the road to $50,000 probably in the first quarter of 2021,” said Antoni Trenchev, managing partner and co-founder of Nexo in London, which bills itself as the world’s biggest crypto lender. Institutional investors returning to their desks this week will probably boost prices further after retail buying over the holidays, he said.
Bitcoin has increasingly been “embraced in more global investment portfolios as holders expand beyond tech geeks and speculators,” Bloomberg Intelligence commodity strategist Mike McGlone wrote in a note last month.
Proponents of the currency have also seized on the narrative that the coin could act as a store of wealth amid supposed rampant central-bank money printing, even as inflation remains mostly muted.
Bitcoin should eventually climb to about about $400,000, Scott Minerd, chief investment officer at Guggenheim Investments, told Bloomberg Television in a Dec. 16 interview.
Still, there are reasons to be cautious, partly because bitcoin remains a thinly traded market. The currency slumped as much as 14% Nov. 26 amid warnings that the asset class was overdue for a correction. The big run-up in price in 2017 was followed by an 83% rout that lasted a year.
Ether also rose, surpassing $900 for the first time since February 2018 when it hit a record $959.15. The jump of as much as 20% to $921.92 on Sunday comes as the token continues to develop a following of its own.
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