Bitcoin rose to a new record high on Thursday, as risk sentiment continues to improve after a selloff in April spurred by the US tariffs crisis.
The world’s largest cryptocurrency reached a high of $111,691.50, and was last at $110,601 at 9.30 GMT.
Its ascent was driven by a combination of factors including easing trade tension between the United States and China and Moody’s downgrade of US sovereign debt which has prompted investors to seek alternative investment sources to the dollar.
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“Now that January’s high has been surpassed – and the 50% upside from April’s lows has been achieved – bitcoin enters blue sky territory with tailwinds in the form of institutional momentum and a favourable US regulatory environment,” Antoni Trenchev, co-founder of digital asset trading platform Nexo, said in a comment emailed to Reuters.
Bitcoin at times trades in a similar fashion to tech stocks and other assets that rise in value when investor sentiment is high. The tech-heavy Nasdaq is up 30% from its early April low.
That has also coincided with continued weakness in the dollar, a further boost for bitcoin’s exchange rate against the currency.
Crypto market participants often point to increased involvement from traditional financial firms as reasons for its gains.
This week they have referenced JPMorgan CEO Jamie Dimon, a longtime crypto sceptic, who said the bank will let clients buy bitcoin. Earlier this month, crypto exchange Coinbase was added to the S&P 500 index.
Coinbase said on Monday the US Department of Justice has opened a probe into a recent data breach at the company.
“We’re still in year four of the bitcoin price cycle – the year after the bitcoin halving when miner rewards are slashed in half – which historically means its best days are still ahead of it and – while macro uncertainty and the threat of further volatility remains, a target of $150,000 in 2025 is still very much on the cards,” Trenchev said.
Meanwhile, ether, the second-largest cryptocurrency, surprisingly did not rise in tandem with bitcoin. It was last down 0.5% at $2,513.
- Reuters with additional input and editing by Jim Pollard
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