The price of bitcoin (BTC) surpassed $31,000 for the first time ever Saturday morning, a little more than an hour after blowing past $30,000 like it was a non-event, all in all starting 2021 in notable fashion following a remarkable year by the leading cryptocurrency.
Once the price of bitcoin crossed the $30,000 mark, something it had struggled to do for the last couple of days, it took off as if all resistance had been removed, hitting a new all-time high of $31,509.08, before falling back to $31,079.99, up 5.44% in the last 24 hours.
The performance comes after a year in which the cryptocurrency rose more than 300% in 2020, with an almost 50% gain just in December, sort of like a boulder gaining speed downhill, only in the opposite direction.
For those who prefer dollar figures to percentages: On Nov. 30, bitcoin breeched a nearly three-year-old high of $19,793. By the close of Dec 31, the cryptocurrency had risen about $10,000. For the visually inclined, see the chart below.
And of course the market value of bitcoin jumped as well, rocketing past many of the most well-known companies in the world. With a market value of $569.1 billion, BTC is now more valuable than all but nine publicly traded companies, sitting between Alibaba at $648.3 billion and Berkshire Hathaway at $543.7 billion.
Bitcoin enthusiasts will likely find some joy in having passed Berkshire, an event that occurred last week, as the company’s CEO, legendary investor Warren Buffett, once famously derided bitcoin as “probably rat poison squared.”
Propelling the record-setting run is a growing narrative that bitcoin represents a form of “digital gold,” along with a flood of institutional investors (probably not Buffett) into the cryptocurrency: Among them: Anthony Scaramucci’s Skybridge Capital ($182 million in December); MassMutual ($100 million in December); and Guggenheim (up to 10% of its $5 billion macro fund).
This is borne out by that the number of whale entities – clusters of crypto wallet addresses held by a single network participant holding at least 1,000 bitcoin – rose to a new record high of 1,994 this past Wednesday.
The metric increased by over 16% in 2020 and 7.3% in Q4 alone.
“The final land grab has started, and by this time next year, accumulating >1,000 Bitcoin will be nearly impossible for most people,” Jehan Chu, CEO at Hong Kong-based trading firm Keneti Capital, told CoinDesk.
HODLers also have the U.S. Federal Reserve to thank for bitcoin’s rise, as it, along with other central banks, has been printing money with abandon, trying to stave off the worst economic effects of the pandemic. Meanwhile, U.S. President Donald Trump has been pushing Congress to issue larger stimulus checks. These actions are viewed by many as potential catalysts for inflation and bad for the U.S. dollar, both of which could be positive for BTC.
To be sure, not all the late gains in 2020 may have been due to a fear of missing out or to hedge against a deteriorating dollar. With the end of the year looming, some fund managers may also have bought BTC so they can brag in this year’s fund literature about having been smart enough to get in in 2020 while neglecting to say at which price they had done so.