Bitcoin Breaks $51K, German Analyst Says ‘Looks As if Bitcoin Is Eating Gold’

This article provides an update (as of 08:00 UTC on 17 February 2021) on the current state of the Bitcoin markets, as well on the latest thinking on Bitcoin by influential crypto analysts, investors, traders, and other thought leaders.

On Wednesday (February 17), the day after Michael Saylor, CEO of MicroStrategy Inc. said that his Nasdaq-listed software firm plans to buy more Bitcoin (which helped Bitcoin to break $50,000), the price of Bitcoin on crypto exchange Bitstamp went above $51,000 at 07:52 UTC before reaching $51,214, which is the new all-time high (ATH), six minutes later.

According to data by CryptoCompare, currently (as of 08:2 UTC on February 17), BTC-USD is trading around $50,745, which means that Bitcoin’s market cap stands roughly at $945 billion. Bitcoin is up 2.95% in the past 24-hour period and up 75.15% in the year-to-date (YTD) period.

Yesterday, Charles Hayter, Co-Founder and CEO of CryptoCompare, a leading cryptoassets market data provider, had this to about the reasons for Bitcoin’s price surge above $50K:

MicroStrategy’s plans to purchase a further $600 million in bitcoin marks the latest milestone in the growing trend of corporate and institutional adoption of bitcoin that is driving price to all time highs.

This ongoing tightening of supply driven by significant purchases by corporations eying the long-term view comes at a time where friction for institutional investors to gain exposure to digital assets is rapidly reducing, creating a perfect storm for Bitcoin price appreciation.

The recent $1.5 billion investment in Bitcoin by Tesla for use as a treasury reserve asset has further legitimised the inflation hedge narrative and the ‘store of value’ use case for Bitcoin. In doing so it has made it much more likely other corporations will follow suit as it is harder to look foolish after one of the world’s most successful entrepreneurs and innovative companies have made such a high profile commitment to Bitcoin.

Around one hour before the Bitcoin price broke through the $51,000 level, Ki Young Ju, the CEO of South Korean blockchain analytics startup CryptoQuant, pointed that the “Coinbase Premium Index” had gone positive again, which is a bullish indicator. According to CryptoQuant, the higher the gap between the Coinbase price for Bitcoin (BTC-USD) and the Binance price for Bitcoin (BTC-USDT), the higher the premium, and thereby the stronger the spot buying pressure from Coinbase (which is the exchange most popular with investors in the U.S.).

Dutch crypto analyst/trader Michaël van de Poppe said earlier today that now that Bitcoin has gone above $50K and is being hyped by mainstream media, traders and investors are happy to buy as much BTC as they can whereas they were no interested last March, when they could have BTC for as little as $5000 (or even less).

Holger Zschaepitz, Senior Editor at the Economic and Financial desk of the German daily Die Welt and its Sunday edition Welt am Sonntag, offered a market update earlier today, and said that it appears as though investors are increasingly turning to Bitcoin instead of gold to hedge against higher inflation.

Meanwhile, the latest analysis from on-chain market intelligence startup Glassnode shows that “there are now more than 94,000 #Bitcoin addresses holding at least $1 million worth of $BTC.”

Fnally, yesterday, veteran analyst/trader Peter Brandt mentioned that “Bitcoin is undergoing its third parabolic advance in the past decade.”

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The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.

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