Bitcoin tops $57,000 for the first time in more than two years as rally picks up steam

Bitcoin has topped $57,000 for the first time in more than two years as investors pile in to the cryptocurrency.

The digital coin hit a high of $57,462 yesterday, taking gains to 10 per cent this week and 35 per cent this year.

It has not been changing hands at these levels since December 2021, when it was retreating from the record high of close to $69,000 reached the previous month.

Some analysts now believe bitcoin is on course to hit $100,000 this summer. However, others remain sceptical and regulators continue to warn that anyone who buys crypto could end up with nothing.

Walid Koudmani, an analyst at broker XTB, said that nothing is certain in the world of crypto. 

‘It seems difficult that the price of bitcoin would almost double until June as markets usually tend to see corrections on their way up or down,’ he said. 

‘The interesting thing for the crypto market is that, while it may seem quite improbable, it is impossible to rule out.’

This week’s rally kicked off on Monday when software firm MicroStrategy said it was buying 3,000 bitcoin tokens for around £120million, taking its holding to over £9billion.

MicroStrategy is thought to be the largest publicly listed holder of bitcoin in the world and its latest swoop was seen as a vote of confidence in the wider crypto sector.

Greta Yuan, head of research at digital asset platform VDX, said the market was ‘encouraged by crypto bulls such as Micro-Strategy’ – with the price of smaller rival Ether also climbing on the announcement. 

Yuan added that bitcoin was also benefiting from a wave of investments in so-called exchange traded funds (ETFs) linked to its price after approval from US regulators.

At the end of January, the Security and Exchange Commission gave the go-ahead to 11 bitcoin ETFs, including funds from Wall Street giants BlackRock and Fidelity.

Previously, the only way to buy bitcoin in the US was from an exchange, which can be an intimidating process and involves technical aspects such as wallets and keys.

Bitcoin could get a further lift this year from another so-called ‘halving’ event.

This is when the reward for bitcoin mining is cut in half. Generally happening every four years, it is designed to slow the release of the currency.