Bitcoin Mania: Completely Decoupled from Gold and on Way to $1 Trillion Mark
A new ATH above $48,000 made Bitcoin the 7th largest asset in the world, one spot up Tesla, following the company's BTC purchase, which sent the digital asset’s tweet volume at a new high as well.
In a monster candle, yesterday, the price of Bitcoin went from just under $38,000 to above $48,200.
With this more than $10,000 uptrend, the leading cryptocurrency has seen an upside of 141% from its previous ATH of $20,000.
The new all-time high for Bitcoin pushed the market cap of the cryptocurrency to nearly $900 billion and all that much closer to the $1 trillion market.
This new high in the market capitalization made Bitcoin the 7th largest asset in the world, one spot up Tesla, which has a market cap of $818 billion.
Tesla’s shares jumped about 2.6% after announcing the addition of $1.5 billion worth of BTC in its balance sheet, compared to Bitcoin’s more than 27% uptrend Monday. The digital asset is up over 62% YTD.
“Bitcoin as a corporate treasury asset is not yet a mainstream business strategy, but firms like MicroStrategy and now Tesla are highly visible advocates,” said Seamus Donoghue, vice president of sales and business development at digital infrastructure provider Metaco.
“With such vocal sponsors leading corporate adoption, further adoption will follow much faster than currently expected.”
Tesla’s Bitcoin addition is very bullish for Bitcoin, which can propel other companies like tech giants Google, Apple, and Facebook to follow in its footsteps.
#Tesla May Be Catalyst to Get #Bitcoin Market Cap to $1 Trillion — Tesla's disclosure that it's investing in Bitcoin and accepting the cryptocurrency for payment is a stepping stone similar to onboarding by PayPal in October, which points to about $50,000 as the next resistance pic.twitter.com/qpkHdgQ68I
— Mike McGlone (@mikemcglone11) February 8, 2021
According to Cathie Wood’s Ark Invest’s recent report, if all S&P 500 companies were to allocate 1% of their cash to Bitcoin, the price of the digital currency could increase by approximately $40,000 while 10% allocation would see it past $400,000.
BTC/USD is currently trading above $47,000 with $22.34 billion in ‘real’ volume’ following the tweet volume of Bitcoin hitting a new all-time high.
In the past 24 hours, more than 143k tweets were sent that broke the previous records of January 2nd, 2020, and December 22nd, 2017, as per The TIE, all thanks to Musk.
— The Chairman (@WSBChairman) February 8, 2021
Looking at the market price action, the Bitcoin options market was busy with $44k call buying with the end of Feb expiries. $48k and 52k call strikes were also active but not as much.
Almost 40% of the total activity is call buying in the options market, pointing to bullish sentiment.
The latest move also disconnected digital gold from the precious metal. Bitcoin’s correlation made a reversal with gold, for the first time when MicroStrategy announced Bitcoin’s addition as a reserve asset in its balance sheet in August, which now continues.
In August, the traditional safe haven hit ATH around $2,075, and since then, it has been going down, currently around $1,850.
The weakening US dollar, making its way to 90.5, is further aiding in propping BTC up.