Festive ‘Santa-Claus Rally’ Causes Bitcoin to Surge Past $51,000
Last October, Bitcoin breached its $64,900 April ceiling, surging past $65,000. The digital currency jumped by 3%, to an initial high of $66,024.99, outclassing the earlier mid-April record.
The price hike came on the heels of the cryptocurrency entering the New York Stock Exchange for the first time and heralded the beginning of a new world. Now, in this new world, Bitcoin has surged beyond $51,000 during the holidays in what is being referred to as a "Santa-Claus rally", as reported by Business Insider.
The news comes about just as the Cryptorank platform reported that just 6.3% of the total Bitcoin supply is left on cryptocurrency exchanges. This means that the leading digital currency's supply is dwindling fast possibly contributing to its price hike.
Bitcoin was trading 5% higher at $51,191 Friday, soothing the fears of investors over the impact of the Federal Reserve's announcement that it was going to wind down support for the U.S. economy and over the evolution of the Omicron coronavirus variant.
It seems that during these festive times investors were letting go of their worries and focusing on cryptocurrencies across the board. Ether also saw a hike of 4% to reach $4,106, Terra's luna reached a record high of $100.84 and Cardano's ada rose 8% to reach $1.45.
And Bitcoin's popularity is only set to surge further partially due to its low supply. "Bitcoin will see a new wave of buyers," Philip Gradwell, chief economist at Chainalysis, said in a note to Business Insider. "The big question is whether the institutions that entered in Q4 of 2020 and Q1 2021 — the majority of recent, new institutional buyers — decide to sell to this next wave. If so, then the price pressure will be muted as new demand is balanced by their sales."
Gradwell added that if everyone continues to hold on to their stocks, then the price pressure of the cryptocurrency could soar due to the fact that the supply of bitcoin that is readily available to buy is at historical lows.
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