The Bitcoin world celebrates a new price record

Tuesday was the day. The price of bitcoin surged above $69,000, surpassing the record set in November 2021. Shortly after, a volatile period ensued, with a sharp correction followed by a strong recovery. Where do we stand now? That, and more, you'll read in this Weekly!

This Weekly in brief:

• Market: Bitcoin has had another good week. Yesterday, the price briefly touched the all-time high of $69,000, the peak of the previous bull market.
• News: Bitcoin price has been the talk of the town in terms of news this week. In the US, the regulator SEC is facing increasing pressure from both the executive and judicial branches.

Market update

In February, the price of bitcoin increased by 44%. This is the largest monthly gain of this bull market. The last time we saw such a large increase was in December 2020, just after reaching a new all-time high. This time, we were just ahead of that.

The chart below shows the two-step rocket that led to this. In December and January, the price moved sideways in the range between $40,000 and $45,000. The midpoint was precisely at $42,500, which was also the opening price of 2024.

At the launch of the ETFs, we briefly exceeded the price range, and during the subsequent correction, we briefly fell below it. This can be explained by a combination of investors taking profits after a fantastic fourth quarter and investors finally being able to exit Grayscale's fund without penalty.

Beginning in February, outflows from the Grayscale ETF decreased while inflows to the rest remained steady. Since February 8th, the ETFs have collectively added an average of 5,000 bitcoins to their vaults per calendar day. This is five times the 900 bitcoins that are put into circulation daily. If there is more demand than supply at a certain price, the market resolves this by increasing the price until enough of the existing supply becomes available.

The first jump occurred between February 7th and 14th. The price rose by 20% from $42,500 to around $51,000. A period of consolidation of just under two weeks followed. The second jump began on February 26th and took us to around $62,000 in two days. A 22% increase this time.

Around $62,000, the upward trend briefly held its ground. It wasn't long before the train started rolling again. The next station was the all-time high of $69,000, which marked the peak of the previous bull market on November 10, 2021. Along the way, we surpassed all-time highs in the British pound and the euro. Some media outlets in the Netherlands briefly mentioned this. For the first time ever, you had to pay more than €60,000 for a bitcoin.

But the destination was truly the magical peak of the previous bull market. We shouldn't stick too precisely to a specific price. On Coinbase, it was $69,000 down to the cent, but other exchanges recorded slightly different numbers. It's in the vicinity of this price that we can expect a market reaction.

An earlier all-time high rarely surrenders easily. In various financial markets, such a price often signals a pause in the rally, or sometimes even a turning point. The chart below shows how it was in December 2020 with a then-record price of around $19,800. The price hit an all-time high on November 30 and only truly broke through the barrier 16 days later.

How will it go this time? Yesterday, the price reached the all-time high. On some exchanges, it was exactly the same, on others slightly above. Just like on November 30, the media immediately published the record price article that was already prepared. But just like then, the initial reaction was a drop in the price.

Would that drop also be visible in the flows of money to the ETFs? Did ETF investors sell massively at an all-time high? We didn't have to wait long for the reassuring answer. No, the ETFs also recorded a strong inflow yesterday. BlackRock's fund saw the largest inflow since its launch, with $788 million. It might just be that this time we don't have to wait 16 days for the price to truly break above the all-time high!

News overview

Today, most traders stare at charts on computer screens. TradingView is a popular tool for this purpose, offering not only price charts but also dozens of tools to understand financial markets and predict their future trajectory.

However, there was a time when these tools were not available at all. A time when you had to go to the stock exchange to read the value of a share from mechanical screens. And a price chart? You had to draw it by hand on graph paper. Including the derivative indicators that you can now display with the press of a button.

It was during this time that Peter Brandt began his career in the financial sector. Since 1975, he has been active as a prop trader, and in 1990, he published his first book on the use of common patterns in charts that map the commodities market.

What he didn't know back then? Almost 25 years later, he would pay tribute to people who possess an entirely new commodity, and the vision and conviction to make it thrive:

Congratulations to those who are fully engaged with bitcoin and other coins that he sees as the foundation of future financial systems. I believe this can happen, and that bitcoin will become important for preserving wealth.

My generation, the generation of [president] Biden and Gen Xers, has been at the helm of the great American credit crisis. We are responsible for piling debt on Millennials and Zoomers. There is something revolutionary happening with crypto that old investors cannot grasp. But you, the younger generation, understand it – and hopefully crypto can save the system, or at least generate incredible wealth for your generation.

So, here's my ode to you. You deserve it.

Brandt keenly feels that bitcoin has had some impressive weeks, accompanied by an optimistic sentiment. He does not choose the path of least resistance – the typical ill-informed perspectives of his peers – but rather, he compliments those who invest in what he believes. Namely, in a better, more transparent, and fairer financial system. "The old guard doesn't understand it, but something revolutionary is happening," says Brandt.

Other news:

• Nigeria demands $10 billion from Binance. According to local authorities, the exchange's illegal services have "caused damage to the economy." Binance claims stelt to be unaware of the claim. Earlier, two Binance executives were reportedly arrested in Nigeria.

• Telegram also plans to share advertising revenue with users. Payouts will be made in Toncoin (TON) via the TON network. Telegram channels generate 1 trillion views monthly. TON's price surged over 20% after the announcement.

• More and more American politicians are calling for the SEC to pull back. The "enforcement-only" mode in which the watchdog operates is increasingly seen as undesirable. This week, SEC Commissioner Hester Peirce called her own agency's behavior "peculiar."

• Union Investment launches blockchain fund. This company is Germany's third-largest asset manager. Part of the raised capital will be invested in crypto assets via certificates. The majority will flow into the stock market.