The price of Bitcoin (BTC), the largest cryptocurrency by market capitalization, has risen above $21,000 U.S. per share and continues to outperform stocks and other asset classes to start the New Year.
Bitcoin has now gained 25% since the start of January as the current rally gathers steam. It is a stark reversal for Bitcoin, which trended lower for most of 2022 and whose price was below $16,000 U.S. at the end of November last year.
Other cryptocurrencies, notably Ethereum (ETH), are also rallying. The price of Ethereum is now $1,540.00, up 28% since the first trading day of the year.
The gains seen in Bitcoin and Ethereum are trouncing the increases in equities, with the benchmark S&P 500 index up 5% to begin 2023. Cryptocurrencies are also outperforming other assets such as gold and the U.S. dollar.
The rally comes as more than $5 billion U.S. in assets have been recovered at bankrupt crypto exchange FTX, and as rival exchange Binance manages to avoid becoming insolvent itself.
In 2022, the price of Bitcoin declined nearly 60% while Ethereum’s value decreased 55%.
The renewed interest in digital coins and tokens comes as several popular meme stocks, including video game retailer GameStop (GME), movie theatre chain AMC Entertainment (AMC), and household décor retailer Bed Bath & Beyond (BBBY) also rally.
In the last week, shares of GameStop and AMC each rose more than 20% while Bed Bath & Beyond’s stock gained more than 100% as retail traders execute a short squeeze on the securities.
