Last month, as bitcoin approached $45,000, JPMorgan Chase CEO Jamie Dimon compared the cryptocurrency to a Pet Rock and said people need to “stop talking about this s—.”
Now, bitcoin investors are laughing all the way to the bank.
The cryptocurrency is up a whopping 20% in just five days. And with Wednesday’s gains, it’s nearing its all-time high of around $69,000 set in November 2021, the last time bitcoin traded above $60,000.
The rally is partly driven by billions of dollars flowing into the cryptocurrency after the US Securities and Exchange Commission green lit bitcoin exchange-traded funds last month.
The other major factor at play is the upcoming “halving” of bitcoin. Halving refers to the built-in feature of bitcoin that automatically reduces the rate of new coins entering circulation. It takes place roughly every four years and, in theory, pushes the price of bitcoin higher because it creates more scarcity of an already finite currency.
This happens because the bitcoin miners (who are behind programs used to solve complex math problems that are intrinsic to using the token) see their bitcoin-denominated reward cut in half when a threshold is reached.
In the past, bitcoin halvings have catalyzed significant bullish periods. But there’s no hard rule this is the outcome each time. Any number of events — such as the prospect of new regulations — could take a bite from any potential gains that come from a halving.
However, investors so far seem to be quite optimistic that won’t play out, and are rushing to get in on the action or cash out their gains. Coinbase, a crypto exchange platform, experienced major outages as a result of the surge in trading, the company’s CEO Brian Armstrong said in a post on X Wednesday.
“Some users may see a zero balance across their Coinbase accounts & may experience errors in buying or selling,” Coinbase Support posted on X around 1 pm ET on Wednesday. “Our team is investigating this & will provide an update shortly. Your assets are safe.”
An hour and a half later, Coinbase said in another post on X it was “beginning to see improvement in customer trading.” It added customers may still be experiencing some issues “due to increased traffic.”
Coinbase declined to comment to CNN about the outages, beyond the X posts.
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