Bitcoin neared an all-time price high as bullish sentiment gathered steam ahead of a listing by the largest US cryptocurrency exchange.
The token rose as much as 2.6% to $61,229 (€51,416), the highest in nearly a month, before falling back to trade little changed.
On March 13, Bitcoin reached a record of $61,742. The cryptocurrency is up almost ninefold in the past year, a return that towers above that of more familiar assets like equities or bullion.
Against the backdrop of Wall Street’s growing embrace of cryptocurrencies, the direct listing of digital-token exchange Coinbase Global is fanning interest.
Coinbase is due to go public on the Nasdaq this week, the first listing of its kind for a major cryptocurrency company and a test of investor appetite for other start-ups in the sector.
“A crypto company moving to IPO is a big milestone,” said Nick Jones, CEO and co-founder at cryptocurrency wallet Zumo.
“It’s moves like this that make consumers feel safer with crypto and ultimately boost confidence in the space.”
A growing list of companies are looking at or even investing in Bitcoin, drawn by client demand, price momentum and arguments that it can hedge risks such as faster inflation.
Tesla earlier this year disclosed a $1.5bn investment in Bitcoin and more recently started accepting it as payment for electric cars.
Elsewhere, Goldman Sachs has said it’s close to offering investment vehicles for Bitcoin and other digital assets to private wealth clients. Morgan Stanley plans to give rich clients access to three funds that will enable crypto ownership.
The deck of exchange-traded funds tracking the token is expanding, while Paypal and Visa have begun using cryptocurrencies as part of the payments process.
“In recent months, a clear and emphatic narrative that Bitcoin is becoming a store of value in the form of digital gold has developed,” according to Jeroen Blokland, a portfolio manager at Robeco.
Other cryptocurrencies, such as second-ranked Ether, have also been climbing.
Coinbase, meanwhile, is expected to go public at a staggering valuation of about $100bn. That’s more than the venerable New York Stock Exchange and Nasdaq Stock Market combined – for a company that didn’t even exist a decade ago.
If all goes according to plan, this week’s scheduled direct listing on Nasdaq will cement Coinbase’s position as the Big Board of the US crypto scene and a potent symbol of the risks and rewards of the new era of digital money.
Its founders, Brian Armstrong and Fred Ehrsam, own stakes worth $15bn and $2bn, respectively.
Coinbase said last week it expects to report first-quarter profit of $730m-$800m, more than double what it earned in all of 2020. And revenue in the first three months of 2021 probably surpassed all of the $1.3bn total for last year.