Bitcoin hits record above US$71 000

Amanda Cooper and Harry Robertson - Bitcoin hit a record high yesterday above US$71 000, as the surge in the biggest cryptocurrency showed no signs of slowing down.

Britain's financial watchdog yesterday became the latest regulator to pave the way for digital asset trading products after saying it will now permit recognised investment exchanges to launch crypto-backed exchange-traded notes.

Bitcoin rose by as much as 4.8% to a record US$71 677 in European trading, bringing gains for the year so far to 70%.

The world's most valuable cryptocurrency has been boosted by a flood of cash into new spot bitcoin exchange-traded funds as well as hopes that the Federal Reserve will soon cut interest rates.



Supply

Flows of capital into the 10 largest US spot bitcoin exchange-traded funds slowed to a two-week low in the week to 8 March, but still reached almost US$2 billion, according to LSEG data.

"Bitcoin has started the week with a surge, dragging the rest of the cryptocurrency space higher with it," DailyFX strategist Nick Cawley said.

Supply of bitcoin, which is limited to 21 million tokens, is going to get tighter in April, when the so-called halving event takes place.

Every four years, the rate at which new supply is released into circulation, as well as the reward for crypto miners, is halved, which tends to support the price.

"News also out earlier that the LSE plans to accept applications for bitcoin and ethereum ETNs in Q2 may have also helped today’s push higher," Cawley said.