Bitcoin tops $72,000 for the first time as rally builds steam

Bitcoin tops $72,000 for the first time as rally builds steam

Bitcoin topped $72,000 for the first time, advancing for a sixth straight day and taking gains this year to almost 70% on the back of massive inflows into US exchange-traded funds.

The original cryptocurrency rose as much as 5% to $72,880 on Monday, before paring the increase. Smaller tokens like Ether, Solana and Avalanche also advanced. The crypto gains came even as equities were mixed ahead of a key report on US inflation.

“It’s a full on continuation of last week’s trend,” said Vetle Lunde, a senior analyst at K33 Research. “Traders are clearly in a risk-on mode.”

Investors have poured a net almost $10 billion into a batch of new Bitcoin ETFs since they launched in the US two months ago, igniting a broad surge in crypto markets. Digital assets scored more wins on Monday, as the London Stock Exchange confirmed it will accept applications for admitting Bitcoin and Ether exchange-traded notes and Thailand’s securities regulator said retail investors will be allowed to buy overseas crypto ETFs.

“With new highs being made and signs of continuing institutional support shown by the LSE news, some people might’ve seen that breakout as a perfect opportunity to get even longer BTC,” said Chris Newhouse, a DeFi analyst at Cumberland Labs.

The success of the crop of Bitcoin ETFs add to a range of bullish signals for cryptoassets. Perhaps the most anticipated milestone is the quadrennial “halving” scheduled for April, when Bitcoin’s supply growth will be reduced by half.

Other technical indicators point to growing interest among both institutional and retail investors. Open interest on Chicago-based CME Group’s Bitcoin futures market has jumped 44% from this year’s low, while a rebound in the so-called funding rate signals that traders are increasingly willing to pay a premium for opening leveraged long positions in Bitcoin.

“Perps (perpetual futures) have traded at premiums above $80 since BTC’s breakout at 07:00 (UTC), the premiums spiked towards $350 amidst BTC’s initial breakout alongside growing open interest,”  said Lunde.

MicroStrategy Inc., the enterprise software firm that has made buying Bitcoin part of its corporate strategy, said on Monday that it spent $822 million purchasing more tokens from Feb. 26 through March 10.