Bitcoin tops $50,000 as it wins more mainstream acceptance

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Bitcoin rose above $50,000 on Tuesday for the first time, adding steam to a rally fuelled by signs that the world`s biggest cryptocurrency is gaining acceptance among mainstream investors and companies.

Bitcoin rose above $50,000 on Tuesday for the first time, adding steam to a rally fuelled by signs that the world`s biggest cryptocurrency is gaining acceptance among mainstream investors and companies.

Bitcoin hit a record $50,603 and was last up 0.83% at $48,351. It has risen around 67% so far this year, with most of the gains coming after electric carmaker Tesla said it had bought $1.5 billion in bitcoin.

The move by Tesla, which also said it would accept bitcoin as payment, was the latest in a string of large investments that have vaulted bitcoin from the fringes of finance to company balance sheets and Wall Street, with U.S. firms and traditional money managers starting to buy the coin.

“The rally in bitcoin in part reflects the recent buoyancy of market confidence but also headlines suggesting an increase in corporate acceptability,” said Jane Foley, head of FX Strategy at Rabobank.

Evolve Funds Group said on Tuesday it had applied to launch a Bitcoin exchange-traded fund on the Toronto Stock Exchange. That would be the second planned bitcoin ETF after Canada`s main securities regulator approved a fund by Purpose Investments Inc.

Such mainstream moves could help bitcoin become a widespread means of payment – having so far failed to achieve large scale adoption – and in turn bolster prices.

“The more people that adopt it and use it as money, then the greater the chances of it perhaps being taken on board as a mainstream currency,” said Russ Mould, investment director of AJ Bell. “That would feed further speculative interest.”

The rush in 2021 by retail and institutional investors comes on top of a 300% rise last year as investors searched for high-yielding assets and dollar alternatives amid rock-bottom or even negative interest rates globally.

 

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