The leading cryptocurrency by market value has finally taken out the much anticipated $20K level for the first time in history. The BTC/USD pair is currently trading well above this all-important milestone, and it seems to have now entered price discovery mode.
The king coin last traded near these levels almost three years to the day on Dec 17, 2017. Back then, BTC topped out near $20K for a few moments before a major sell-off ensued.
This time around, the flagship crypto has managed to push a few hundred dollars into uncharted territory at its current price of $20,756 on Bitfinex.
BTCUSD Chart By TradingView
The rally to a new price record follows an inspiring rally through November and into December. A few weeks ago, the king coin did break its previous price record of $19,666 to top out at $19,856 on Bitfinex before it corrected lower.
Now that the $20K resistance has been breached, BTC is certainly in a new bull market, and investors can expect the coin to cap off 2020 with a bang.
BTC Rally Founded on Institutional Interest
As per a November Twitter thread by blockchain analytics firm Chainalysis, the ongoing BTC rally is mainly driven by institutional investors buying Bitcoin for purposes of long-term holding.
Indeed, many investment funds have revealed that they are hedging with Bitcoin over the past few weeks.
Mainstream Companies like Square inc, MicroStrategy, and MassMutual have all placed multi-million bets on BTC, making the current rally more sustainable.
The latest mainstream player to bet on the institutional adoption of BTC is Ruffers Investment Company. The UK-based firm recently released a note to investors notifying them of a new 2.5% allocation to Bitcoin.
Bitcoin Fundamentals Are Stronger Than Ever
Along with the growing institutional demand, there is increasing perception among traditional investors that BTC is an inflation hedge and a store of value. These factors mark the current rally as different from 2017’s move to the previous ATH, which was mainly driven by retail investors.
The long-term bullish case for Bitcoin looks even better when observing the BTC network’s fundamentals. Bitcoin’s fundamentals are stronger, with the network now ten times safer than it was during the previous 2017 bull market.
Moreover, the BTC network’s hash rate, which indicates the entire blockchain’s health, continues to hit new record highs this year.