SYDNEY, Australia – As cryptocurrencies rode a wave of momentum, flows, positive news, and inflation fears, bitcoin soared near its all-time high on Monday while ether climbed to a new high.
Bitcoin surged more than 4% to $66,170, approaching the all-time high of $67,016.50 set on Oct. 20, while ether, the cryptocurrency that supports the ethereum network, hit a new high of $4,768.07.
Last month, investors hailed the debut of a U.S. futures-based bitcoin exchange-traded fund and sought exposure to an asset class that is frequently considered as an inflation hedge. Ether is up roughly 59 percent since the beginning of October, while bitcoin is up about 51 percent.
As traders prepare for inflation, falling real rates make assets like gold and cryptocurrencies that don't pay a coupon more appealing, according to Kyle Rodda, analyst at broker IG Markets, who added that the sentiment in the sector has been positive.
He continued, "Financial institutions want to be a part of it, and authorities don't want to overregulate it." We're almost at the point where it's part of the system, and it'll be very, very difficult to get it out.
In recent weeks, Australia's largest bank has announced that it will provide crypto trading to retail consumers, Singaporean authorities have sounded favourable on the asset class, and the asset class has benefited from the positive sentiment in the stock market.
Following Miami's mayor's offer, New York Mayor-elect Eric Adams announced he would take his first three paychecks in bitcoin and pledged to make his city the "hub of the cryptocurrency sector."