Bitcoin recently reached a historic milestone by briefly surpassing the market capitalization of silver, crossing the $73,000 mark for the first time. This achievement is pivotal for the world's largest and oldest cryptocurrency.
The surge in Bitcoin's value can be attributed to several factors, including the recent approval of spot BTC exchange-traded funds (ETFs) in the United States.
Bitcoin experienced a significant breakthrough on March 8 when it soared past $70,000, setting a new record.
Despite a brief correction to the mid-$66,000 zone, BTC has catapulted to an impressive $73,573 on the 14th of March.
According to CoinGecko data, Bitcoin has gained approximately 10.4% over the past week and an even more remarkable 53.1% increase during the last month.
Following this recent surge, Bitcoin has become the eighth-largest asset globally, boasting a market capitalization of $1.41 trillion.
This accomplishment placed it ahead of silver, the second-largest precious metal in the world, which currently holds a market cap of $1.383 trillion.
Bitcoin now sits comfortably at 9th on the list of the top 10 most valuable companies and assets.
The chief crypto now trails the top-tier assets of Microsoft, Apple, Nvidia, Saudi Aramco, Amazon, and Google's parent company, Alphabet.
Gold maintains its stronghold as the leader, with a market cap of $14.685 trillion.
The Impact of Spot ETFs
The bullish momentum in Bitcoin's value can be attributed partly to the success of spot ETFs, which witnessed over $2.2 billion in inflows last week, as reported by BitMEX Research.
By the end of the week, BlackRock’s IBIT spot ETF alone has accumulated approximately $13.6 billion in assets under management.
Since their introduction, ETFs have absorbed 4.06% of the existing Bitcoin supply, with projections indicating an annual increase to 8.65% of the BTC supply.
Bitcoin Halving Event
Another factor influencing the Bitcoin price surge, the upcoming Bitcoin halving event scheduled for April, adds fuel to the fire.
During this event, the reward given to Bitcoin miners for processing new blocks will be halved from 6.25 BTC to 2.125 BTC.
This reward reduction will lead to a daily decrease of around 900 BTC, valued at approximately $73 million.
The anticipation of reduced supply has undoubtedly contributed to the heightened demand and subsequent surge in Bitcoin's value.
Ripple Effect: Ether (ETH) and Other Cryptos Gain Ground
While Bitcoin takes the spotlight, other major cryptocurrencies have experienced substantial gains.
Ethereum (ETH), the second-largest cryptocurrency, has surged past the $4,000 milestone, demonstrating the widespread bullish sentiment in the crypto market.
Ether's ascent has its catalysts. The impending launch of the Dencun upgrade in just two days has fueled optimism.
Dencun is expected to significantly improve network scalability and reduce transaction fees for layer 2 blockchains. This positive development adds to the overall optimism surrounding the cryptocurrency market.
Looking Ahead
Bitcoin's unprecedented surge past $71,000 and overtaking silver's market cap is a testament to the growing influence and acceptance of cryptocurrencies in the global financial landscape. The confluence of factors, including the success of spot ETFs, the approaching halving event, and the overall bullish sentiment in the crypto market, has propelled Bitcoin to new heights.