Why Is Bitcoin Going Up? – Forbes Advisor INDIA

The world’s largest cryptocurrency, Bitcoin, hit a spectacular level of $68,637 for the very first time since Nov. 2021 on March 5, few points short of its all-time high $68,789, but dropped down to $66,418 minutes later. BTC has risen nearly 4.20% in the last 24 hours as on March 5 this year and has exhibited stellar performance through 2023.

What has made Bitcoin hit the $68,000 level and how should this rally be approached are questions that have intrigued investors worldwide. Here’s a deep dive into what has led to the sudden rise of BTC, and how the market expects the coin to perform in the future. 

Bitcoin Trading At $68,000 In March 2024

Bitcoin fell dramatically due to uncertainties fuelled by the U.S. Federal Reserve’s interest rate hikes post Covid-19 and recovered only in 2023 as the monetary policy stance stabilized toward a pause. The year 2024 has been remarkable for BTC so far with a sudden surge in prices. 

Last month, Bitcoin surged almost 51.09% marking level of $50,000 mid-Feb. As of March 5, 2024, BTC is trading at $66,447 with a market capitalization of $1.31 trillion.

The major reason for Bitcoin prices to rise is strong inflows into the Spot Bitcoin ETFs which the Securities and Exchange Commission approved only recently. According to the information services company, “The Block”, as of Feb. 29, 2024, Spot Bitcoin ETFs witnessed a daily total net inflow of nearly $678.67 million with Blackrock, Fidelity and Grayscale majorly contributing in the Bitcoin ETF volumes. 

Experts believe the upcoming Bitcoin Halving event in April 2024 has also spurred the market’s sentiment toward Bitcoin crossing its all-time highs. Market participants expect BTC to bypass all previous highs and set new records. 

Bitcoin Price Movement in the Last Six Months 

Bitcoin Price Chart (Past 1 month)

Why is Bitcoin Rising?

Among the key reasons why Bitcoin has surged to reach its highest since 2021 include:

• Strong inflows into Spot Bitcoin ETFs.
• The Bitcoin halving event is anticipated to take place in April 2024. This could be another reason for Bitcoin rising and is expected to further push BTC prices upwards, which might surpass its all-time high before the event. 
• Investor’s expectation that the Federal Reserve could continue its pause on interest rate hikes and possibly raise interest rates as the economy stabilizes. 
• The banking sector’s woes in the U.S. has led digital currency supporters to reiterate the significance of decentralized finance and the need to have full control of one’s own money without the regulation of banks that themselves find it difficult to stay afloat in a tough global economic environment. 

What Lies Ahead for Bitcoin? 

While the future of Bitcoin remains unclear, retail investors can benefit from the current situation by diversifying their portfolios. Investors need to be cautious as upcoming events can bring extreme volatility in Bitcoin prices, which could swing in any direction. 

When analyzing if investors should invest their hard-earned money in Bitcoin, it is important to note that despite the rising value of BTC, it might still crash like it has done in the past. The currency is still trading at almost at a 3.11% low from all-time highs of $68,990 in November 2021. 

With Bitcoin Halving this year, BTC might soon surpass its all-time high and set a new record. But with unforeseen volatility and as history testifies Bitcoin falling more than a third in value, only time can tell if this current rally is a bull run or a bull trap.

Bottom Line

Nevertheless, Bitcoin’s current growing value has raised the debate of another cryptocurrency roaring and has uplifted the emotions of the entire crypto community across the world. All eyes are now set on what the levels of BTC and whether BTC will hover around $68,000 or soon surpass its all-time high before Bitcoin Halving.