Bitcoin Hits Record Highs

By: Jack Bennett

This past Wednesday, the world’s largest traded cryptocurrency, bitcoin, hit a record high of $66,930.39 while other smaller traded coins followed in its growth. After its value diminished this past summer, the currency has made a historical return, rapidly passing its original highs. A large portion of its success can be attributed to the first exchange-traded Bitcoin ETF (ticker: BITO). While this ETF tracks the futures of Bitcoin and not the price itself, it is still very significant for the end of the cryptocurrency market. This debut raises awareness for Bitcoin and other currencies alike and allows many more investors to hold a stake in the cryptocurrency market.

In the past, many respected investors remained skeptical about the promise of cryptocurrencies. However, with support from prominent firms and advisors from companies like The Motley Fool, a surge of long-term optimism has risen. The Journal of Financial Planning and the Financial Planning Association surveyed more than 500 financial advisors and found that 14% were currently using or recommending cryptocurrencies, up from less than 1% in 2020. Bitcoin and other currencies offer a commodity-like asset that can be considered along with stocks and bonds in many wealth management portfolios. With rising interest rates and inflation, Bitcoin is a promising alternative to gold to combat the rate changes. Many opportunities come with investing in cryptocurrencies; however, it takes a thorough understanding. The unmatched volatility requires a level-headed and calm person to offset the emotional side of investing. For example, in May of 2021, Bitcoin was trading at about $59,000 before dropping around 48% before the end of June.

Bitcoin is not a risk-free investment, but the future is bright. It is an encouraging sign that more and more people have grown to support long-term beliefs in its value. And with continued confidence and momentum, BITO will likely not be the last of its kind in the financial markets.

Harty, Declan. “Bitcoin Shoots Past $66k, with a One-Month Gain of More than 50%.” Fortune, Fortune, 21 Oct. 2021, https://fortune.com/2021/10/20/bitcoin-shoots-past-66k-with-a-one-month-gain-of-more-than-50/.

Wursthorn, Michael. “Financial Advisers Pitch Bitcoin to Investors to Offset Portfolio Losses.” The Wall Street Journal, Dow Jones & Company, 4 Oct. 2021, https://www.wsj.com/articles/financial-advisers-pitch-bitcoin-to-investors-to-offset-portfolio-losses-11633347001.