Bitcoin hits new high above $37,000 as crypto market passes $1tn

Photo by: STRF/STAR MAX/IPx 2021 1/3/21 Bitcoin soars past $33,000, its highest ever.

Bitcoin (BTC-USD) continues to climb higher, reaching a new record high above $37,000 (£27,000) in the early hours on Thursday morning.

Bitcoin hit a high of $37,732 at around 5.40am UK time. It marked a new all-time high for the cryptocurrency and came just 24 hours after bitcoin passed $35,000 for the first time.

The rally helped propel the wider cryptocurrency ecosystem to another milestone. The total value of all tokens and coins in circulation topped $1tn for the first time on Wednesday night, CoinDesk reported. The market had pulled back slightly by Thursday morning and was worth $993.2bn, according to CoinMarketCap.com.

Naeem Aslam, chief market analyst at Avatrade, said chaos on Capitol Hill in the US helped to support bitcoin’s price. Trump supporters stormed the senate in chaotic scenes that left four people dead, according to the BBC.

Many bitcoin evangelists argue bitcoin is a “safe haven” asset akin to gold and instability tends to support the price.

Not all analysts agree with this theory.

“I doubt it has anything to do with the situation playing out on the hill,” said Mati Greenspan of Quantum Economics. “Momentum has been building over time, and it’s anyone’s guess where or when we might eventually top out.”

READ MORE:Markets unfazed by attack on US Capitol

Bitcoin has rallied strongly over the last three months, rising more than 200% since the start of October. The rise has coincided with a new wave of institutional interest in the cryptocurrency. Square (SQ) has publicly invested in bitcoin and PayPal (PYPL) now allows customers to handle the token through its platform.

© Provided by Yahoo! Finance UK The price of bitcoin has risen rapidly over the last three months. Photo: Yahoo Finance UK

Aslam said bitcoin was “surely and clearly heading towards the next important price level, which is $40K.”

“A real bull rally has only begun,” he said.

Bitcoin had pulled back slightly by 8.40am in London. The cryptocurrency was down 1.4% against the dollar to $37,039.82.

WATCH: Why Bitcoin’s latest surge is different from its 2017 rally