Why is Bitcoin hitting new highs?
On Wednesday, tech stocks rose, with Nvidia becoming the first company to briefly surpass a market value of $4 trillion. On the same day, investors seemed unfazed by U.S. President Donald Trump's latest tariff measures. The tech-heavy Nasdaq Composite Index set a closing record.
CNBC analysis states that although institutional investors generally accept Bitcoin's positioning as 'digital gold,' it remains a risk asset whose fluctuations are driven by investor sentiment.
When the market is in a risk-on mode and investors are buying growth assets like tech stocks, Bitcoin and cryptocurrencies tend to rise accordingly.
U.S. Bloomberg analysis notes that Bitcoin's surge highlights that even as Trump announces a new round of tariff statements, the market is still rife with speculation.
Spencer Hallarn, global head of over-the-counter trading at crypto investment firm GSR, stated: "The strong demand for stock market instruments such as ETFs and digital asset government bonds supports continued buying of Bitcoin."
As corporate finance departments accelerate their purchases of Bitcoin and Congress is set to pass cryptocurrency legislation, investors have been anticipating that Bitcoin prices will hit new highs in the second half of the year.
