Analysts point to the demand from financial institutions and public companies as the main forces behind the sudden re-examination of Bitcoins (BTC) to an all-time high.

“The main reason Bitcoin has continued to grow is growing interest and strong buying activity from organizations,” said Nick Cott of Hxro Labs gaming platform. “Many investors are turning to shades of gray.”

The growing institutional demand can be seen in the large holdings at Grayscales Bitcoin Trust, as the fund’s BTC assets surpassed 500,000 earlier this month.

Cote also said that leading US companies such as Square and Microstrategy “place the BTC in their public ledgers as a shield against inflation and the mismanagement of monetary policy by central banks.” He described this behavior as creating a “positive feedback loop” in the markets:

“It will certainly be a setback, but as long as institutions believe in the story of using Bitcoin as a store of value or as a hedge against inflation, it will be a positive feedback loop.”
Nicholas Pelikanos, chief trader at NEM, agreed, saying Bitcoin’s fundamentals are stronger than ever, citing the introduction of dynamics after the halving, increased institutional adoption, and a number of U.S. public companies converting 10% of the balance sheet into an asset. ”

Pelecanos is now expecting altcoin markets to rally, saying: “BTC has returned to its peak, but the altcoin valuation is noteworthy, which is still 50% below the average. …”

Despite his optimistic outlook on alternative currencies, Pelicanos warned that many alternative cryptocurrencies have not been purposefully adopted, stating:

“Some altcoins are projects that are no longer operational, but others have evolved greatly in both adoption and technology.”
Analysts also pointed to optimistic signals from the mining markets, with Glassnode CTO Rafael Schulze-Kraft indicating that miners have amassed another 10,000 BTC since March.

Mining revenue has also recently reached its highest level in the new year so far after having recovered from levels before halving, with daily revenues of more than $ 20 million.

Source: CoinTelegraph