Bitcoin had a massive surge in February, with its value increasing by over 40% since the start of the month. The cryptocurrency is now reaching heights that haven’t been seen since 2020, and it seems to be happening every day. However, while investing in Bitcoin may seem like the most profitable option, recent market trends suggest otherwise.
Both the trading exchange Coinbase and the miner Marathon Digital Holdings have outperformed Bitcoin, with gains of 59% and 45%, respectively. This renewed wave of excitement surrounding Bitcoin has also driven up the stocks of companies related to it.
In late January, Bitcoin was trading below $40,000, causing concern among investors. However, the approval of spot ETFs by the U.S. Securities and Exchange Commission has made it easier to indirectly invest in Bitcoin. This has given investors renewed confidence in the market, leading to a significant increase in Bitcoin’s value. By the end of the first week of February, Bitcoin had reached $47,000, and it continued to climb, passing $50,000 and even reaching $57,000 on Tuesday. By Thursday, the total amount of money spent on Bitcoin exceeded $61,000.
In addition to these market trends, there is also the halving event, which is expected to happen soon. This event will reduce the number of Bitcoins awarded to computers for solving complex math problems, potentially increasing the value of existing Bitcoins.
With so much hype surrounding Bitcoin, it’s no surprise that Coinbase experienced a power outage on Wednesday due to increased traffic. However, the company reassured users that their funds were safe. It’s worth noting that not all Bitcoin exchanges have been successful, with several experiencing issues in recent years.
It’s not just pure players in the industry that are benefiting from the increased interest in Bitcoin. The Chicago Mercantile Exchange Group reported a quadrupling of trading activity for their cryptocurrency futures, thanks to the expectation of increased interest in Bitcoin ETFs. Similarly, the trading platform Robinhood revealed that 20% of their Bitcoin holders are investing in the cryptocurrency through an ETF. This influx of new investors shows that ETFs may not always be the best investment option.
Overall, the market for Bitcoin and other cryptocurrencies continues to be unpredictable, with both success stories and challenges. However, the growing interest in Bitcoin ETFs and the continued growth of the market suggest that it’s a trend worth watching closely.