Bitcoin continued its ongoing surge in price Wednesday (Dec. 16), heading above the $20,000 mark for the first time ever — eclipsing its previous record high set in 2017.
The price of a bitcoin traded higher by 5.6 percent, hitting around $20,600. CNBC reported that the surge was fueled by cryptocurrency fans along with a big boost from big-name investors such as Paul Tudor Jones and Stanley Druckenmiller. Tech firms such as Square and MicroStrategy have jumped onboard the investment train as well.
“This is the domino effect as asset managers tumble their portfolios into bitcoin,” Charles Hayter, CEO of market data provider CryptoCompare, told CNBC.
In addition, major Wall Street firms like S&P Global and Cboe Global Markets have been getting into the area of crypto market-data services.
Bitcoin’s latest record high recalls its groundbreaking rally to nearly $20,000 in 2017. However, that was followed by a collapse in price the following year — down close to $3,000.
Cryptocurrency fans, however, argue that now is different — with big investors piling in — as opposed to the retail frenzy of 2017.
“$20,000 is undoubtedly a momentous milestone for bitcoin,” said Yoni Assia, CEO and co-founder of online investment platform eToro. “We have seen a significant shift in the demographic of those interested and invested in crypto.”
Assia said that it’s “no longer the domain of just computer programmers and FinTech advocates.”
What’s up looking ahead?
A Citibank senior analyst predicted that bitcoin could reach $318,000 by December 2021 in a report written for Citibank’s institutional clients.
Thomas Fitzpatrick, global head of CitiFXTechnicals, Citi’s market-insight product, compared bitcoin’s movements to the gold market, which remained within a $20-$35 price range for 50 years before breaking out in 1971.
The major price swings are “exactly the kind of thing that sustains a long-term trend,” said Fitzpatrick in the report, according to CoinDesk.