Updated: Feb 16
Bitcoin has been rather unsteady since December but there appears to be a huge surge across the financial services industry, which resulted in the cryptocurrency closing in on $50,000 for the first time before falling back on Monday. A week after Tesla made a $1.5 billion investment in Bitcoin, the digital asset continues to make waves across the traditional finance sector, including news that an investment unit of Morgan Stanley is thinking about investing.
Canada also approved the first North American Bitcoin exchange-traded fund. There’s also evidence that more companies are beginning to add services for cryptocurrencies - an asset class that is still lightly regulated and controversial among policymakers.
Bitcoin prices are up by 40% and were at about $48,000 in London on Monday. There remains a fierce debate over whether Bitcoin is a legitimate asset with any real purpose or value. Despite this, the price trend has been up, and Bitcoin stands as another example of the speculative excesses that is defining the market.
There are hints that more Wall Street companies could invest in the crypto market in the comin weeks.
Bitcoin currently uses more energy than Argentina every year, according to analysis from the University of Cambridge.
Production of the cryptocurrency, known as "Bitcoin mining", needs energy-hungry computer hardware and ever-greater amounts of processing power.
The cryptocurrency has already risen in value by 62% this year, on top of a 300% rally in 2020, as investors search for alternative assets at a time when interest rates in many countries are at record lows.