Bitcoin yesterday reached a record high, rising above US$125,000.
The cryptocurrency reached US$125,689, shooting above its previous August record of about US$124,500.
Bitcoin has enjoyed a strong upward momentum with investors cautious about the US government shutdown.
Photo: Reuters
Gains in US shares have also supported bitcoin’s rise, while investors have looked to safe haven assets while US lawmakers negotiate over funding the federal government, Bloomberg News reported.
US President Donald Trump and his family have also been big promoters of cryptocurrencies and are involved in several crypto endeavors that have inflated his wealth.
Trump’s embrace of digital assets has reversed years of US government skepticism toward the crypto industry under his Democratic predecessor, former US president Joe Biden, with the US House of Representatives passing three landmark cryptocurrency bills in July.
The regulatory changes have seen the value of bitcoin soar.
“With many assets including equities, gold and even collectibles like Pokemon cards hitting all-time highs, it’s no surprise bitcoin is benefiting from the dollar debasement narrative,” Joshua Lim, co-head of markets at crypto prime brokerage firm FalconX, was quoted by Bloomberg News as saying.
US stocks on Friday touched record highs amid another round of big-ticket artificial intelligence deals and partnerships, bucking the prospect of a prolonged shutdown and a gloomy reading on business activity.
Treasuries and the US dollar slid, while gold was on track for a seventh weekly gain, fueled by central bank buying amid falling US interest rates and lingering inflation concerns.
“The shutdown matters this time around,” Standard Chartered PLC digital assets research head Geoff Kendrick said, adding that he expects bitcoin to rise during this period.
He said that bitcoin was “in a different place” during the previous shutdown between 2018 and 2019, when the token traded less in line with traditional risk assets.
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