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Bitcoin is quickly outpacing some of the Fortune 500 companies that make up the traditional markets.
The price of Bitcoin (BTC), the world’s premier digital currency has soared to a new all-time high (ATH) at $56,421.14 according to CoinMarketCap. The attained milestone has also earned Bitcoin a market capitalization above $1 trillion.
The record-breaking parabolic rise in Bitcoin’s valuation has stirred celebration on social media, as the cryptocurrency revalidated the general appeal of the global digital asset market.
Anthony Pompliano, the co-founder of Morgan Creek Digital Assets also tweeted, “RIP bears,” referring to those investors who had probably offloaded their Bitcoin before the milestone was attained.
The growth of BTC, in general, has been meteoric, taking a new twist with an influx of institutional investors. This class of bulls are betting big on the digital asset as they believe it offers a better shield against inflation and as a store of value.
Bitcoin “has started to get so big that it arguably creates its own demand as companies and institutions begin to make forays into a field they wouldn’t have touched a few months previously,” Deutsche Bank research strategist Jim Reid said in a note. “Ironically it is turning itself into a credible asset class to many by rallying so much of late and also by getting increasing institutional buy-in.”
The digital currency has also influenced other aspects of the crypto market as many altcoin prices are in part correlated with that of Bitcoin.
Bitcoin with Its Growing Market Capitalization May Outpace Traditional Markets
The traditional market, particularly those of the United States closed the week with mixed performance. The S&P 500 (INDEXSP: .INX) dropped 0.19% to 3,906.71, the Nasdaq Composite (INDEXNASDAQ: .IXIC) added 9.11 points to 13,874.46, while the Dow Jones Industrial Average (INDEXDJX: .DJI) closed the week with a negligible gain of 0.0031% to 31,494.32.
Bitcoin is fast outpacing some of the Fortune 500 companies that make up the traditional markets. The cryptocurrency has now outpaced other valuable firms like electric vehicle maker, Tesla Inc (NASDAQ: TSLA) whose market cap is pegged slightly above $749 billion dollars.
As the crypto market is active all week long, the ongoing bull run may push BTC beyond its current levels, further breaking off from the correlation it once shared with the S&P 500. The potentials of the Satoshi Nakamoto-born asset as a global reserve currency was reiterated by Bloomberg senior commodity strategist, Mike McGlone.
“Sure there are speculative excesses, like in all bull markets, But the bitcoin tide is rising on the back of it becoming a global digital reserve asset,” McGlone said in an email note shared with Coindesk.