Bitcoin Surges 10% in 24 Hours on Massive Demand for Cryptocurrencies

The cryptocurrency Bitcoin rose to a level of $57,000 in early morning trading in Asia for the first time since late 2021, supported by investor demand through exchange-traded funds as well as additional purchases by MicroStrategy Inc.

The largest digital asset gained 10% in the last 24 hours, but slightly reduced its gains to $56,480 level at the time of writing this on Tuesday morning after advancing more than 5% in the US session. Bitcoin’s price has risen by 30% since the beginning of the year, leading to a continued upward trend that has also sparked appetite for trading in smaller digital currencies such as Ethereum and BNB.

The rise in demand from instant trading funds, which saw net inflows of $5.6 billion, has fueled demand for the unique symbol beyond just digital asset enthusiasts, according to data collected by Bloomberg and seen by Al Arabiya Business.

On its part, MicroStrategy, an enterprise software company that buys Bitcoin as part of the company’s strategy, said on Monday that it has purchased 3,000 new Bitcoin this month. The company now owns around $10 billion worth of Bitcoin.

In a memo, Katie Stockton, founder of Fairlead Strategies, wrote, “We do not expect a significant decline in Bitcoin due to its breakthrough and positive momentum in the medium term.”

The total value of digital assets now stands at around 2.2 trillion dollars, according to CoinGecko, compared to a low level of about 820 billion dollars during the bear market in 2022 when FTX and other cryptocurrency platforms collapsed.

Digital currencies have surged despite investors tempering their expectations for more flexible monetary policy this year, as evidenced by the rise in US Treasury bond yields.

According to Sean Farrell, the head of digital asset strategy at Fundstrat Global Advisors, the upward momentum in cryptocurrencies is evident despite the slight increase in interest rates.

Bitcoin outperformed traditional assets like stocks and gold this year. The comparison between the token price and the precious metal reached its highest level in over two years.

Stocks of companies related to cryptocurrencies in the United States rose on Monday. MicroStrategy’s shares increased by 16%, the trading platform “Coinbase” rose by 17%, and mining company “Marathon Digital” saw a jump of 22% in their stocks.