Bitcoin rose to its highest level on record on Wednesday, eclipsing the previous high from January, as risk sentiment continues to improve after last month’s tariff-induced selloff.
The world’s largest cryptocurrency touched a high of $109,760.08, and was last up 1.1% at $108,117.
Its ascent was driven by a combination of factors including easing trade tension between the United States and China and Moody’s downgrade of U.S. sovereign debt which has prompted investors to seek alternative investment sources to the dollar.
“Now that January’s high has been surpassed – and the 50 percent upside from April’s lows has been achieved – bitcoin enters blue sky territory with tailwinds in the form of institutional momentum and a favorable U.S. regulatory environment,” Antoni Trenchev, co-founder of digital asset trading platform Nexo, said in an emailed comment.
Bitcoin at times trades in a similar fashion to tech stocks and other assets that rise in value when investor sentiment is high. The tech-heavy Nasdaq (.IXIC) is up 30% from its early April low.
That has also coincided with continued weakness in the dollar (.DXY), a further boost for bitcoin’s exchange rate against the U.S. currency.
Crypto market participants often point to increased involvement from traditional financial firms as reasons for its gains.
This week they have referenced JPMorgan CEO Jamie Dimon, a longtime crypto skeptic, who said the bank will let clients buy bitcoin. Earlier this month, crypto exchange Coinbase (COIN.O), was added to the S&P 500 index.
Coinbase said on Monday the U.S. Department of Justice has opened a probe into a recent data breach at the company.