Bitcoin experienced significant gains on Tuesday, reaching a two-year high and rising as far as $57,036. Ethereum also saw a significant increase, rising as far as $3,275, its highest since April 2022. This increase was driven by signs of increased institutional buying and optimism surrounding regulatory developments.
By 9:07 GMT, Bitcoin was trading at $56,277.40 while Ethereum was trading at $3,224.84.
Bitcoin’s rally
Bitcoin saw a remarkable rally of more than 10 percent in just two sessions. Key drivers included the disclosure from crypto investor and software firm MicroStrategy regarding its recent purchase of 3,000 Bitcoins worth $155 million. This influx of institutional investment, coupled with the approval of Bitcoin-owning exchange-traded funds (ETFs) in the United States, contributed to the cryptocurrency’s surge to its highest level since late 2021.
Ethereum’s milestone
Ethereum also witnessed a significant milestone as it surpassed the $3,200 mark. Fueling the cryptocurrency’s upward trajectory was growing anticipation over the potential approval of spot Ethereum ETFs, mirroring the recent success of Bitcoin ETFs. Ethereum’s role in the future of cryptocurrencies within the financial system is growing, further boosting investor confidence.
Factors driving momentum
A major incentive for the cryptocurrency market is the upcoming Bitcoin halving event in April. This process slows the release of the cryptocurrency whose supply is capped at 21 million by cutting the reward for producing the tokens in half. Of that supply, 19 million have already been mined.
This scarcity-driven mechanism, combined with growing demand fueled by institutional interest and regulatory developments, has contributed to Bitcoin’s 32 percent gain in February, marking its largest one-month increase since January 2023.
Read: Gold prices rise as market awaits U.S. inflation data
Institutional endorsements
Institutional endorsements continue to strengthen the credibility of cryptocurrencies as viable investment assets. Social media platform Reddit’s announcement of investing in Bitcoin, ether, and other digital assets further underscores the growing acceptance of cryptocurrencies as part of corporate investment strategies.
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