Bitcoin Price Doubles in Institutionally-Driven First Quarter; What’s in Q2?
Bitcoin went into an upside mania in the first quarter of the year.
The flagship cryptocurrency surged by roughly 102 percent as investors showed no fears of risk-taking. On the contrary, they embraced it as interest rates on government bonds rose but remained near their historically low levels. New rounds of government stimulus packages further pushed investors to risky corners of the market, showing a lot of fiat liquidity in the market, waiting to enter speculative assets.
What a Quarter!
When 2021 began, bitcoin investors did not know that Democrats would sweep both the House and the Senate. But as the so-called blue sweep happened, it paved the way for their leader, the US President Joe Biden, to push through an expansive stimulus package than many had anticipated.
Additional dollar liquidity tends to make bitcoin investors and traders bullish.
Next month saw one of the most celebrated bitcoin investments ever made, led by Elon Musk’s Tesla, which added $1.5 billion worth of bitcoins into its balance sheets.
The US carmaker clearly stated in its securities filings that it considers Bitcoin as a store of value asset like cash. It added that it would start accepting the cryptocurrency as payments for its electric vehicles, a promise it realized ahead of Q1’s close. Payment company Square also added $170 million worth of BTC in its reserves, atop its $50 million investment last year.
Bitcoin price surged by up to 82 percent after Tesla’s announcement
On the other hand, MicroStrategy kept raking Bitcoin on every price correction attempt.
In Q1 alone, the Nasdaq-listed software intelligence firm bought 19,714 BTC in two separate rounds. Meanwhile, Bank of New York Mellon, Mastercard, Visa, PayPal, Morgan Stanley, and Goldman Sachs announced crypto-enabled services, fueling prospects of higher retail and institutional interests in Bitcoin in the coming quarters.
