Bitcoin tops $66,000 as it nears 2021 high

Price of bitcoin rallied early in the week, moving even closer to its all-time high after the rally took a breather over the weekend.

The leading cryptocurrency was last up 5% to $66,042.60, according to Coin Metrics. It earlier rose to $66,332.00, its highest level since November 2021. Ether advanced 1.5% to $3,525.21.

Both coins are coming off their best week in nearly a year (Bitcoin gained about 21% and Ether 16%), but stalled over the weekend as the market absorbed two days of steep outflows from the Grayscale Bitcoin ETF, which was offset by inflows into other “newborn” Bitcoin ETFs.

“With the birth of these nine new ETFs, the big moves now tend to take place during the normal trading week rather than weekends,” said Antony Trenchev, co-founder of crypto exchange Nexo. “What we’re seeing today… may be a repeat of the start of last week, when Bitcoin jumped $10,000 in a matter of days. We’re in an environment where a day or two of sideways consolidation can be preceded by explosive price action thanks to voracious demand for these new spot ETFs.”

Investors were extremely eager to see Bitcoin approach its all-time high. At $66,000, that’s about 4% off the November 2021 intraday high of $68,982.20.

Some analysts suggest that while it may continue to grow in the short term, Bitcoin may cool off in the next few weeks as unrealized profit margins approach extreme levels. Bitcoin’s realized price is around $42,700, according to CryptoQuant.

However, long-term investors are confident that the combination of rising demand for bitcoins through new US exchange-traded funds and tighter supply expected after the halving event in April will push the price of bitcoin to a new all-time high.

Crypto is also getting a light bid from the stock market, where the tech-heavy Nasdaq Composite hit an all-time high on Friday, becoming the last of the major stock indexes to hit a record close this year. David Duong, head of institutional research at Coinbase, said that while March could be a sideways month for bitcoin, the cryptocurrency is benefiting from a performance boom driven by AI and blockchain technology that he expects to stick.

Bitcoin has lifted other crypto tokens, especially meme coins. Dogecoin jumped 8% while the Shiba Inu coin jumped 18%. Analysts point to their performance as evidence that retail investors, who were absent for much of the recent crypto rally, are beginning to return to the crypto market.

Crypto stocks rode the Bitcoin wave. Coinbase and Micro strategy have grown by 6% and 18% respectively. In the mining group, CleanSpark and Digital marathon each trading about 6% higher and Riot Platforms added 3%.