TOKYO (Reuters) – Bitcoin consolidated Monday at around $ 60,000, taking a breather from the weekend’s record high as investors braced for concerns about inflation and US stimulus spending. plus.
The world’s most popular cryptocurrency fell as low as $ 58,956.90 at the start of the Asian session, falling from Saturday’s all-time high of $ 61,781.83.
The rally may have been dampened by a Reuters report that India would pursue a ban on digital assets, a rain cloud for bitcoin following high-profile endorsements this year from the likes of Tesla’s Elon Musk, Twitter’s Jack Dorsey and the investment giants Goldman Sachs and Black Rock.
Bitcoin has more than doubled in 2021, after quadrupling last year.
“Investment from institutional and corporate investors is increasing. It’s what I call the financialization of bitcoin, ”said Masafumi Yamamoto, chief currency strategist at Mizuho Securities.
“It is becoming an asset that investors can no longer ignore.”
Bitcoin’s weekend surge was helped by an improvement in risk appetite in financial markets after President Joe Biden enacted his $ 1.9 trillion fiscal stimulus package and ordered an acceleration of vaccines.
That momentum carried over to thinner markets over the weekend, with technical factors magnifying the move up, according to Justin d’Anethan, a sales manager at Hong Kong-based digital assets company Diginex.
“The cryptocurrency market has a lot of derivatives,” he noted.
“A small upward movement caused a lot of sell-offs on Saturday and Sunday, thus becoming a not-so-small move.”
Seth Melamed, chief operating officer of Tokyo-based cryptocurrency exchange Liquid, said legislation of the kind India is proposing will not be an impediment to making higher profits for bitcoin.
“Because it is decentralized, government bans or acceptance are somewhat irrelevant,” Melamed said. “Capital will find a way.”
Reporting by Kevin Buckland; Additional reporting by Sagarika Jaisinghani and Alun John; Edited by Vidya Ranganathan and Jacqueline Wong