- Bitcoin prices surged more than 23% to at least $6,600 in a single day after a 30% year-to-date drop.
- Investors have seen central banks worldwide pump large amounts of fiat currency into the global economy, depressing prices.
- There are only 21 million bitcoin in existence, making it a relative safe haven for investors.
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Cryptocurrencies have seen a remarkable resurgence as investors flock to relative safe havens amid a flurry of quantitative easing measures by global central banks.
Central banks including the European Central Bank, Federal Reserve, and the Bank of England have announced asset-purchase schemes in recent days. Bitcoin, a finite cryptocurrency with only 21 million units in existence, has seen a 23% one-day surge. Bitcoin is currently up 21% as of 10.10 a.m. in London (6.10 a.m. ET), per Coindesk.
The cryptocurrency had been down 30% year-to-date amid a sell-off fueled by market uncertainty about the outbreak of coronavirus. However, investors may be looking to digital currencies in the wake of easing measures elsewhere. Other cryptocurrencies like ethereum, XRP, and bitcoin cash all saw major reversals by more than 15% over the same period.
“When it comes to bitcoin, the crypto king is on fire, and we have seen a decent rally,” said Naeem Aslam, chief market analyst at AvaTrade, in a morning note.
“Given the fact that the price has crossed the $6,000 mark — an important level of resistance — the upward momentum is likely to pick up the pace, and if the price crosses the 200-day moving average on a daily time frame, it would be a huge buy signal.”
Volumes at cryptocurrency exchanges have jumped, with Coinbase, Bitstamp, and Bitfinex combined seeing a 19% bump in 24-hour exchange volume, according to data aggregator CryptoCompare.