Singapore, Feb. 29 (Reuters) Money pouring into listed bitcoin funds drove a sweeping rally that put bitcoin on track for its greatest monthly gain in more than three years on Thursday.
The largest cryptocurrency by market capitalization traded at $61,100 in Asia morning session after reaching $63,933 overnight. Its monthly increase exceeds 44%, the highest since December 2020.
Last bought $3,416, up 50% in February, it is driving the lesser ether along. Tony Sycamore, an analyst at IG Markets, said the momentum implied "a test and likely break" of $69,000, which would push bitcoin over its November 2021 record high.
“If this were any other market, it would likely be in the 'blow-off top - don't go near that bubble' category," said City Index senior market analyst Matt Simpson. "But bitcoin is back in its parabolic-rally phase, with no immediate signs of a top."
The licensing and introduction of spot bitcoin exchange-traded funds in the U.S. this year has attracted new investors and revived interest in the asset class after the "crypto winter" of 2022.
LSEG data revealed $420 million in flows into the 10 largest spot bitcoin ETFs on Tuesday, the greatest in over two weeks. Volumes rose at Grayscale, Fidelity, and BlackRock (IBIT.O), opens new tab.
Before April's halving event, traders flooded into bitcoin. Every four years, the rate at which tokens are released and miners' earnings are halved. Bitcoin has 21 million supply, 19 million of which have been mined.
The potential of more Federal Reserve rate cuts this year has also increased investor interest in higher-yielding or more volatile assets. As foreign exchange volatility falls to two-year lows, the U.S. stock volatility index (.VIX) returns to pre-pandemic levels.
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