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Bitcoin has hit a record high against the Japanese Yen following a 25 per cent price increase over the last two weeks for the cryptocurrency.
A recent resurgence for bitcoin has coincided with a dip in value for Japan’s currency against other fiat currencies.
The depreciating yen comes amid testing times for the Japanese economy, which is currently in a recession. The Bank of Japan has attempted to ease pressure through liquidity easing, which has helped further devalue the yen against bitcoin, which is immune to such economic measures due to its decentralised design and fixed supply.
Against the US dollar, which is used by most major crypto exchanges, bitcoin is currently worth around $52,000 – still a way off its all-time high of just above $68,000.
Bitcoin’s price has been boosted in recent weeks by new inflows from institutional investors, who were offered a new way into the crypto space through the first ever approvals of spot exchange-traded funds (ETFs) for bitcoin.
The decision by the US Securities and Exchange Commission (SEC) in January was described by market watchers as a “historic” moment for the industry.
Billions of dollars have since poured into the crypto market, helping lift bitcoin’s price by more than $10,000 since the ETFs were approved.
“Market momentum continued to be fueled by the high demand for BTC ETFs,” noted Matteo Greco, a research analyst at investment firm Fineqia International.
“Throughout last week, the cumulative net inflow into BTC ETFs totaled about $2.3 billion, nearly doubling the $1.2 billion recorded in the previous week, and accounting for almost half of the total net inflow since inception, which currently stands at roughly $5 billion.”
Recent estimates from the multi-national bank Standard Chartered projected that between $50 billion to $100 billion of institutional investment could enter the crypto market this year, with one analyst at the bank claiming it could push bitcoin’s price towards $200,000 by next year.
Price momentum has also been fueled by the prospect of the upcoming halving event, which will see the rewards for mining the cryptocurrency slashed in half.
Halvings take place roughly every four years, with previous events all preceding record-breaking rallies. Some analysts, such as the pseudonymous PlanB, claim that the halvings form a foundational basis for a quadrennial price cycle for the cryptocurrency.
The next halving event is currently forecast for 17 April, 2024.