- Bitcoin fell from its record high of nearly $US50,000 on Monday after a week-long flurry of increased attention.
- The token traded around 1.6% lower at $US47,845 after hitting its latest all-time high of $US49,716 on Sunday.
- Rising prices and market dominance will lead to increased regulatory scrutiny, one crypto expert said.
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Bitcoin slid on Monday from its latest all-time high as investors took profit from its record-breaking rally last week.
The digital asset dropped 1.6% to $US47,845, after posting a record of $US49,716 on Sunday. Meanwhile, ethereum dropped 0.6% to $US1,789.
Bitcoin attracted more attention on Wall Street last week as a flurry of updates pushed the token to the near-$US50,000 mark.
Tesla announced a $US1.5 billion bitcoin investment, Mastercard is preparing to open its network to crypto, Bank of New York Mellon plans to start transacting bitcoin for its clients, and an investing arm of Morgan Stanley said it’s considering a stake in bitcoin.
“Bitcoin is increasingly going mainstream and the vote of confidence by major companies could have positive effects on the cryptocurrency that will last well beyond the knee-jerk reactions seen in the past week,” said Milan Cutkovic, market analyst at AxiCorp.
Combining growing institutional demand with ultra-low interest rates, bitcoin could touch further highs in the first quarter of 2021.
One analyst thinks it could shoot higher than $US50,000 this week. But that may require another financial institution to announce it will offer crypto custodial services for their wealthy private clients, said Jeffrey Halley, a senior market analyst at OANDA.
“I prefer to concentrate on fundamentals though with cryptos,” Halley said, adding that he can’t buy a coffee using cryptocurrency with an animal’s face on it. “Therefore, I shall wait for Elon Musk’s Twitter account to tell me what to do, because nothing is more fundamental than that, and it is always right.”
But with increasing dominance and value, comes increasing regulatory scrutiny.
“Bitcoin and other cryptocurrencies will come under the spotlight from watchdogs like never before and this can be expected to create volatility in the market,” said Nigel Green, CEO and founder of investing firm deVere Group.
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