Bitcoin enthusiasts eagerly anticipate the cryptocurrency’s ascent to an all-time high, and while the price is on the verge of this historic moment, the market capitalization has already achieved a record-breaking $1.35 trillion. This surpasses the previous peak of $1.28 trillion observed in November 2021 during Bitcoin’s pandemic-era bull run when the token reached $68,991.85.
Despite Bitcoin’s supply growth since then, its market capitalization has scaled new heights in the current rally. As of Tuesday, the digital asset hovered around $67,360, briefly touching $68,804 earlier.
Historically, a record market value has served as a reliable indicator of a new phase in the cryptocurrency market. David Lawant, Head of Research at crypto prime broker FalconX, notes its significance in signaling market shifts.
Recent gains in Bitcoin’s price have been fueled by demand from new U.S. spot Bitcoin exchange-traded funds (ETFs) and an impending reduction in the token’s supply growth. ETFs introduced by major entities like BlackRock Inc. and Fidelity Investments have attracted nearly $8 billion in net inflows since their debut on January 11.
The broader crypto market has also witnessed a resurgence in speculative fervor, ranging from leveraged bets in derivatives markets to substantial intraday gains in meme coins. Notably, open interest at the Chicago-based CME Group’s Bitcoin futures market reached a record on March 4.
While the extended investor positioning suggests vulnerability to a reversal if ETF demand moderates, the overall sentiment in spot, ETF, and derivatives markets remains predominantly bullish. Chris Weston, Head of Research at Pepperstone Group Ltd., attributes the driving force behind price action to the ongoing flow show.
