The surge in the prices of the Bitcoin saw a pause on Wednesday after days of rally reaching at its all-time-high.
Shortly after the jump to as much as 2.5 per cent to USD 69,191.95 after 10 am in New York, it almost reversed course.
It was sent at one point to 14 per cent below the record to USD 59,317.16. At its high on Tuesday, Bitcoin was up about 63 per cent so far in 2024, outperforming global stocks and spreading optimism across the digital-asset market.
According to the crypto data tracker CoinGlass, the recent gains had been amplified by bullish bets made in the derivatives market, where investors in the past could get leverage of as much as 100 times the size of their positions in products such as perpetual futures.
With Bitcoin reversing its early gains, more than USD 800 million worth of bullish positions were quickly liquidated in the perpetual futures market, it added. In the recent past, the steady tide of money has poured into the exchange-traded funds (ETFs) issued by investment heavyweights including BlackRock Inc. and Fidelity Investments.
The net inflow of almost USD 8 billion in less than two months is colliding with a looming reduction in Bitcoin’s supply growth.
Bitcoin has surpassed the previous record set in November 2021, however, the value was sunk by 2022 to USD16,500.
This has led the US finance giants pouring billions into buying bitcoins.
On Tuesday, Bitcoin rose to around USD 69,200 shortly after 15:00 GMT before falling back, and trading around USD 62,185 by 21:00 GMT.