Bitcoin (BTC), the world’s leading cryptocurrency, defied expectations to break past the $44,000 mark for the first time in almost a month.
As per CoinMarketCap’s data, BTC hit $44,544.64 on Thursday, making a 24-hour price gain of 4%.
Bitcoin’s latest uptrend follows a period of relative stagnation and is fueled by positive developments in the overall market.
Thailand Slashes 7% Tax On Crypto Trading
Earlier today, in a move to push the country toward becoming a digital asset hub, Thailand’s Finance Ministry announced the decision to ease crypto tax rules by exempting value-added tax (VAT) on cryptocurrency trading.
Paopoom Rojanasakul, secretary to the Minister of Finance, said that the government intends to promote crypto assets as a new alternative tool for fundraising. The law, effective February 8, will suspend the requirement to pay 7% VAT on income derived from cryptocurrency trading.
Experts say the move can be a major boost for the wider crypto market.
Traditional Investors Pivoting From Gold To Bitcoin, Says ARK Invest CEO Cathie Wood
ARK Invest CEO Cathie Wood, who is well known for her pro-Bitcoin stance, recently attributed the price increase of the digital asset to the launch of spot Bitcoin exchange-traded funds (ETFs) in the US.
ARK Invest was among the 11 companies, including Wall Street giants BlackRock and Fidelity, whose ETFs were greenlit for trade by the US Securities and Exchange Commission (SEC) on January 10.
Wood believes that Bitcoin spot ETFs attract investors who traditionally held gold as a safe-haven asset. She noted that traditional investors’ shift from gold to Bitcoin was only going to be positive for the apex cryptocurrency.
Bitcoin Miners Keeping Supply Tight Ahead Of April’s Halving
Meanwhile, CryptoQuant founder Ki Young Ju highlighted in an X post that publicly traded US-based mining companies were retaining their Bitcoin holdings instead of selling them. He said this is a strategic move ahead of the upcoming halving event on the Bitcoin blockchain.
Halving refers to a periodic event that occurs every four years where the block rewards that miners receive as compensation for adding blocks to the Bitcoin network are permanently slashed in half.
Since the fee for transacting in BTC has historically remained low, block rewards make up most of the miners’ revenue, and the halvings have a profound impact on mining economics.
Ju said he understands why miners have decided to keep hold of their Bitcoin instead of selling it as the halving approaches.
The analyst explained that halving is a supply shock event where the supply of Bitcoin gets reduced by half. If demand remains the same while supply decreases, the price of the asset can go up, he noted.
Bitcoin has felt the effects of a supply shock to a certain degree throughout the cycles, but Ju says the effect could be particularly significant this time around.
This is because Bitcoin ETFs are in the market now, and their issuers will have to purchase tokens backing their funds through well-regulated means. Mining companies are one of the sources for these entities to obtain Bitcoin.
The miners realized that a never-seen-before opportunity in the market had opened up before them. If they could keep hold of the mined Bitcoin, they could control the supply, and financial giants like BlackRock would have a limited amount of the asset available to them.
The Coinbase Premium Index – a metric that tracks the percentage difference between the BTC prices listed on other cryptocurrency exchanges and Coinbase – shows that Bitcoin is priced higher on Coinbase than on Binance.
This is because Coinbase is the preferred platform for US institutional and retail investors to purchase Bitcoin and other cryptocurrencies. A positive premium for the leading cryptocurrency on the exchange implies the presence of relatively high buying pressure from ETF issuers.
At the time of writing, Bitcoin (BTC) is trading at $44,572 – up 4% in the last 24 hours.