Jan 7, 2021 - Economy

Bitcoin hits a first: $40K

Illustration of the Bitcoin logo as stained glass panel

Illustration: Sarah Grillo/Axios

Bitcoin reached $40,000 on Thursday, doubling the elusive $20,000 all-time high first set in late 2017.

Why it matters: Deep-pocketed institutional investors have driven the bull run this time, with everyone from Anthony Scaramucci’s SkyBridge Capital to MassMutual fueling the original cryptocurrency's recent price surge.

  • BTC doubled in less than 30 days - after taking three years to hit the prior high on Dec. 16, 2020 - even as political chaos climaxed in Washington, D.C., this week.

Yes, but: The run-up has people wondering if a crash is imminent. Commodity trader Peter Brandt tweeted Thursday that bitcoin's price action has started going parabolic.

  • Even if technical indicators show the market is “overbought,” historically bitcoin can continue in this phase longer than most traders expect, making it anyone’s guess when the top will come.

What to watch: Of course, we live in unprecedented times of political uncertainty in the U.S. Bitcoin is viewed by some as chaos insurance. If there were a clock that counted down the time remaining for the dollar to serve as the world’s reserve currency, Wednesday on Capitol Hill may have taken several minutes off it.

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