- Bitcoin’s price makes its majestic trot towards the $50,000 benchmark
- The price peaked at $49,998, at the wee hours of Tuesday morning
- Biden’s Stimulus package plans a likely BTC price stimulant
Bitcoin’s price reached an all-time high in the early hours of Tuesday, February 16, 2021. The ever-volatile cryptocurrency is slowly creeping to a $50,000 benchmark as it peaked at 49,998 dollars. CoinMarketCap’s portal stated that the value of bitcoin rose to 5.43% at the wee hours of Tuesday (4:22 GMT)
Traders have been watching the procession of Joe Biden’s recent move to pass a steep stimulus package that rakes up to $1.9 trillion.
Biden’s Stimulus Package
On Monday, the Financial Times reported that the President of the United States of America would be embarking on some official trips outside the capital city to publicize the proposal of the aid package. He hopes that doing this will mount a bit of pressure on the congress members into reaching a concession in the current negotiations towards the coronavirus package. The Republicans on Capitol Hill, however, are wary of the economic impact of this move. It would be adding on to the nation’s debt without real foreseeable hope of returns.
However, the public support via polls towards the stimulus package has been massive. The fact that individuals stand to benefit $1,400 and additional aid for the aged, parents and the unemployed made the public all the more enamoured with the stimulus package idea. Democrats hope that some Republicans will be swayed, by the public pressure, to veto the President’s proposal.
Bitcoin’s Upward Boom
The Bitcoin market has seen a renewed bearish bias since the beginning of the week as the stimulus package news caused a headwind. Bitcoin’s price saw a surgeon Sunday to $49,700 but dipped about 5.79 per cent the next day.
But the early hours of Tuesday saw an intense bid in the BTC/USD exchange rate push Bitcoin’s price to as high as $49,998. However, it is now on the benchmark of $49,872.
Role of firms in Bitcoins Price Boom
The Chief Economic Adviser of the Allianz, Mohamed A El Erian, opined that the current rally was driven by fears that there would be an inflation of goods and services among retailers and those who are willing to invest. He pointed towards a few companies like Tesla, who have recently invested massively in Bitcoin, causing the price bubble to go even higher.
Mr Erian told CNBC that there is now an incredible prospect of fiscal injection at the top, coupled with the central bank’s liquidity injection. This causes the investors’ confidence to soar as they believe that they are riding on an incredible liquidity wave.
He added that we would begin to see more firms injecting bitcoin into their balance sheets as they do not have the innate ability to manage risks. Therefore, the financial market will continue to experience a distortion in general.
Crypto analysts are of the mindset that there is a high probability that Bitcoin’s price will reach the benchmark of $50,000 this week even though it has failed to achieve this benchmark after various attempts.