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Bitcoin hit a record high on Tuesday, with the cryptocurrency surpassing $69,000, marking a dramatic comeback for digital assets following a tumultuous stretch of more than two years.

The rally saw bitcoin
the world’s largest crypto by market cap, last up 2.5% to $67,891 on Tuesday, reaching as high as $69208 at one point, according to CoinDesk data. It last hit a record high of $68,990.90 on Nov. 10, 2021. Bitcoin’s price has surged 48% year to date and it’s up 187% over the past 12 months.

The surge has bitcoin in “untested waters” in terms of price discovery, said Matt Ballensweig, head of Go Network at crypto investment services provider BitGo, in a call.

While Ballensweig said it could prove difficult to determine the new equilibrium price for bitcoin, he also thinks it has the potential to reach as high as $150,000 in the next six to 12 months as institutional interest builds up.

Bitcoin’s latest surge was mostly driven by institutional inflows into bitcoin exchange-traded funds and optimism around the coming “halving” event, which is expected to happen in April. Investors have seen a “a ton of new organic buy-side demand” after several new bitcoin ETFs started trading in the U.S. since Jan. 11, Ballensweig said.

From January: Bitcoin ETFs finally approved after a chaotic, ‘embarrassing’ 24 hours for SEC

Meanwhile, halving is a mechanism written in the blockchain’s algorithm to control the supply of bitcoin, which has a cap of 21 million. At halvings, the reward for bitcoin mining is cut in half. Halvings are scheduled to happen about every four years, until the maximum supply of 21 million bitcoins are all released.

Bitcoin’s new record high provides “proof that the crypto winter is over,” according to Ric Edelman, founder of the Digital Assets Council of Financial Professionals. 

During the most recent cycle, bitcoin fell to less than $16,000 in November 2022, after crypto exchange FTX collapsed.  

“It’s almost hard to believe that it was only 16 months ago that FTX came apart, and now we have $40 billion of U.S. spot bitcoin ETFs from multiple issuers out there for investors and advisers to put to work,” said Andy Baehr, head of product at CoinDesk Indices.

The recovery in bitcoin also has investors focused on other digital currencies, with ether trading at $3792. Its record high was $4,865.81 set on Nov. 10, 2021, according to CoinDesk.

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