Bitcoin (BTC) overtook primary U.S. markets last week. The world’s leading cryptocurrency jumped to $6,426.83 on Friday, gaining more than 12 percent. Bitcoin has grown 70 percent since the year started.
The BTC hit $6,000 last week, the cryptocurrency’s first since mid of November. However, it is still having a hard time reaching its highest point of $20,000 that was marked late 2017.
Moreover, while the S&P 500 suffered its year’s worst week, U.S. markets have already recovered from their losses on Friday. S&P 500, along with Dow Jones Industrial Average dropped more than two percent last week, while Nasdaq fell three percent.
According to a report, the founder and CEO of BKCM, Brian Kelly pointed to current institutional interest in cryptocurrency trading from leading institutions. On the other hand, Fidelity Investments is planning to let their customers trade on cryptocurrencies.
Kelly said, “While many investors have flocked to Coinbase over the last few years, we still anticipate a large amount of pent-up demand from retail investors.” “A word of caution, timing the flows from these retail behemoths may prove to be tricky,” he added.
According to Kelly, some investors were hit by numerous false alarm regarding the approval of a bitcoin ETF (exchange traded fund). With regards to this, “market participants do not appear to be pricing in the impact of the two largest retail brokerage firms offering cryptocurrency trading,” he said.
Trading still comes with possible dangers for retail investors. Just a week ago, 7,000 BTC were stolen by hackers from Binance, the world’s leading cryptocurrency exchanges.
Jeff Dorman, chief investment officer at Arca, a digital asset manager based in Los Angeles, said that BTC had not found calmness yet despite the hacking incident.
Dorman says, “This rally has sustained because the positive events surrounding crypto have outweighed the negative risks for months.” “More importantly, the negatives are largely one-off ‘black swan’ type events that create tail risk but are not persistent, whereas the positives are long-term game-changing events that lead to sustained growth,” he added.