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Bitcoin's market valuation crosses $1 trillion again amid risk rally

The world's largest digital asset rose as much as 5.2% before trading around $57,000

bitcoin, cryptocurrency, digital
Olivia Raimonde | Bloomberg
2 min read Last Updated : Mar 11 2021 | 9:47 AM IST
Bitcoin advanced for a fourth day, pushing the digital asset’s market value back above $1 trillion, amid surging optimism in financial markets.

The world’s largest digital asset rose as much as 5.2 per cent before trading around $57,000 as of 12:23 p.m. in New York. It passed $1 trillion for the first time in February on its way to a record high of $58,350.

The gain comes even as a key measure of U.S. consumer prices rose less than expected in February, suggesting broader inflationary pressures remain tame. Bitcoin proponents have championed the digital asset as a hedge against a future surge in inflation.

While the $1 trillion mark is noteworthy, the argument has been made that assigning a market capitalization isn’t an accurate representation since Bitcoin isn’t a company or even an asset. Skeptics say without real-world assets that companies possess or government backing like the dollar, all investors are really buying into is faith in the cryptocurrency’s network.

Ether -- the world’s second-largest cryptocurrency -- advanced as much as 3 per cent. The gains mirror broader risk-on optimism after the Nasdaq 100 Index that rebounded this week from an earlier decline that pushed it into correction territory.

Bitcoin advocates argue that the digital asset is a store of value that can be used as a hedge against inflation and a weaker dollar as fiscal and monetary support flooded financial markets with liquidity over the past year. Detractors maintain that the cryptocurrency is in a stimulus-fueled bubble likely to burst.

Topics :Bitcoincryptocurrencymarket valuation

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