After Breaching $50K, Bitcoin Gives Up Earlier Gains
Bitcoin’s price saw a retracement of its earlier gains on Tuesday, but the market expects that it will soon resume its long-term bullish trend and push fresh new all-time highs.
For a brief moment during early New York trading hours, bitcoin broke above $50,000 for the first time ever. However, at press time bitcoin’s price was trading at $48,249.23, down 0.29% in the past 24 hours, according to CoinDesk’s BPI.
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“It’s an impressive milestone for bitcoin [reaching above $50,000] that the crypto community has been waiting for,” Alessandro Andreotti, bitcoin over-the-counter broker, told CoinDesk. “In my opinion we are going to keep reaching fresh new highs soon.”
The pullback after the record high price at $50,584.85 will not be long-lasting, according to Andreotti.
That is a sentiment echoed by analysts and traders, who note that significant amounts of liquidity flowing into the crypto market as a whole has been the underlying driver of the rally over the past few days.
The market opened last week with the news that Elon Musk’s Tesla purchased $1.5 billion worth of bitcoin as part of the company’s balance sheet strategy. Since then, bitcoin’s price has been able to hold onto those gains, despite a small-scale price retreat like the one that happened on Feb. 14.
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Read More: Tesla Invests $1.5B in Bitcoin, Plans to Accept Crypto Payments
On the retail side, the derivatives market has been on the rise.
In particular, bitcoin’s March futures on the retail-focused platforms have an annualized premium rate averaging at 44.16% at the moment. That outpaces those on the institution-driven Chicago Mercantile Exchange, which averaged at 24.39%, noted Arcane Research’s newsletter dated Feb. 16. Higher premiums indicate more demand on a particular platform.
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“Retail traders want that upside exposure and are pricing the futures that expire in March at a premium of almost 5% to the spot price,” the newsletter said.
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