Bitcoin and gold raced towards record highs as investors bet on interest rate cuts this summer.
The digital currency reached $67,584 yesterday – its highest level for more than two years – sparking predictions that an all-time high is ‘around the corner’.
Bitcoin is within touching distance of its peak of $68,999.99 in November 2021, having risen more than 50 per cent this year.
At the same time, gold rose to $2,120 an ounce, its highest level since December 4 when prices hit an all-time high of $2,135 before falling later in the day.
Brent Donnelly, trader and president at analysis firm Spectra Markets, said: ‘We are back to a 2021-style market where everything goes up and everyone is having fun.’
Both gold and bitcoin have been boosted by the prospect of lower interest rates in the US and beyond.
Analysts said any signs that inflation is falling will continue to fuel hopes of rate cuts – and in turn boost the value of assets such as gold.
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‘If inflation numbers remain tame, gold’s going to continue to trend higher,’ said Jim Wyckoff, senior analyst at Kitco Metals.
Bitcoin crashed to below $16,000 in late 2022 as the cryptocurrency industry was plagued by scandal, which included the collapse of trading platform FTX and subsequent fraud conviction of its founder Sam Bankman-Fried.
But it has bounced back strongly, helped this year by approval from US regulators for 11 exchange traded funds (ETFs) linked to its price.
And bitcoin is also set to get a further lift next month from another so-called ‘halving’ event when the reward for bitcoin mining is cut in half.
All of this means that an all-time high is ‘around the corner’, says to Lukman Otunuga, senior market analyst at online broker FXTM.
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Robert Johnson is a UK-based business writer specializing in finance and entrepreneurship. With an eye for market trends and a keen interest in the corporate world, he offers readers valuable insights into business developments.
