Another day, another market rise. The global market cap of cryptocurrencies continues its march north, sitting at $472 billion. The last time crypto was worth this much was back in the halcyon days of January 2018 – before everything came crashing down.
While it’s still a far cry from the $716 billion recorded in those heady days, this time the markets are in better shape. For one, daily trading volume compared to the peak of two years ago is four to five times higher than it was. In 2018, the biggest daily volume was $37 billion. Crypto hasn’t had a trading day below that number since May 2019.
The primary driver of these liquid times appears to be Bitcoin, who has found a home on Wall Street.
Just yesterday, a senior Citibank analyst made the grandiose prediction to the bank’s clients that Bitcoin was heading for a six-figure valuation in 2021.
The thesis was based on the trend that investors who have been roughed up by turbulence in the traditional fiat markets are looking for somewhere safer to put their money, which in this case, is Bitcoin.
It’s a sentiment echoed by Anthony Scaramucci, the founder of SkyBridge Capital and the former communications chief of the Trump administration.
In a filings note posted last week, Scaramucci’s firm, which manages $7.7 billion in assets according to Reuters, said it “may seek exposure to digital assets.” It noted that by “digital assets,” the firm meant Bitcoin—but was not limited solely to the biggest cryptocurrency by market cap.
While that’s been going on, Bitcoin’s price set a new record this week as it posted its best-ever three-week close in its 12-year history.
The statistic is a signal of the market’s sentiment towards BTC, as opposed to the short sharp swings the currency has historically been famous for. In 2017, when Bitcoin hit $20,000 it pulled back quickly, suggesting the market felt the price was little more than hyperbole.
This time, however, Bitcoin’s price hasn’t behaved as it has traditionally. The three-week metric puts Bitcoin’s value at just shy of $16,000, indicating the market’s confidence in Bitcoin is much healthier.
Wall Street Struggles As Covid Cases Rise
Markets are looking for signs of a quicker recovery to the COVID epidemic and last night pharmaceutical company Moderna responded in kind.
The company’s own COVID vaccine had a 94.5% efficacy rate in tackling the virus, which pushed markets higher. But the rally wasn’t as significant as that of last week’s after Pfizer announced the results of its tests to find a cure.
At the time of writing, the FTSE 100 was down, and the DAX and CAC 40 were both flat. On Wall Street, the S&P and Dow futures markets were both down as news emerged that new cases have risen week on week in all 50 states.
Governors across the country are pushing for tighter restrictions to try and contain new outbreaks, dampening investor spirits.
Market watchers are now focusing on the latest US retail sales, industrial production and capacity utilisation figures, due in the next few days.