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Bitcoin breaks the $ 47,000 mark for the first time


 Bitcoin breaks the $ 47,000 mark for the first time

Cryptocurrencies expanded their gains in Asia on Tuesday, with Bitcoin hitting record levels, in the wake of Tesla's investment in the cryptocurrency.

Bitcoin recorded its largest daily percentage gain in more than three years overnight, following the announcement made by Tesla in its 2020 annual report.

Bitcoin added up 2.5 percent to a record high of $ 47,565.86 on Tuesday, and has gained 61 percent for the year so far.

In the cryptocurrency's dizzying rally in early January, it topped $ 45,000, $ 46,000 and $ 47,000 in less than an hour on Monday evening, driven by Tesla's announcement that it had bought $ 1.5 billion of Bitcoin.

The $ 45,000 mark was supposed to be a milestone of sorts, but the cryptocurrency race to the top turned it into an afterthought, as the value of the cryptocurrency rose 67 percent to date.

A possible reason for the sudden hiatus in the rally was the waking up of a group of Asian traders to the news of Tesla along with no resistance levels above $ 45,000.

While these may be the direct catalysts for the sudden spike in the value of the cryptocurrency, they are not the only reasons for Bitcoin's staggering rise.

A growing number of large investors have turned to digital currency as a potential hedge against inflation, as the Federal Reserve and central banks around the world pump trillions of dollars of money into financial markets to stimulate their coronavirus-stricken economies.

Tesla has joined publicly traded companies, including MicroStrategy, that funneled their money into Bitcoin, and given the new coin price, it's clear that some investors think it's just getting started.

Many analysts believe this is just the beginning of a much broader adoption of corporate names ready to move into the crypto space.

And given that more investors are buying and holding bitcoin for the long term, the supply of cryptocurrency continues to decline.

According to the information, about 78 percent of total Bitcoin issued is either lost or held, and this leaves less than 4 million Bitcoins to be shared among future market entrants, including large investors such as PayPal and Square.

With this latest rally, Bitcoin's market cap ($ 895 billion) once again surpassed that of Tesla ($ 818.4 billion) after it topped its value for the first time earlier on Monday.