Bitcoin is at an all-time high as a “perfect storm” has ensured a boost. The digital currency hit $124,000 per coin this week, and stock markets and crypto have surged. The price has doubled over the past year, is now contesting gold to become 2025’s best performing asset. It owes its high ranking to Exchange-Traded Fund (ETF) – an investment fund that contains a collection of underlying assets, such as stocks, bonds, or commodities – inflows acting as a catalyst, attracting fresh institutional capital at an extraordinary speed. Simultaneously, US Federal Reserve’s shift towards interest rate cuts has weakened the dollar and boosted the appetite for risk across the board.
Crypto has consequently benefitted “disproportionately”, David Siemer, the chief executive of Wave Digital Assets said. Wider uncertainty has also been sparked after the American government’s shutdown. Senators have failed to pass spending proposals for a fourth time. Two separate plans – one from the Democrats and one from Republicans – did not reach the required 60-vote threshold.
Speaking to Forbes , the expert added that these factors ensured an environment “where even modest demand creates outsized moves”.
Nigel Farage has been a vocal supporter of cryptocurrency in recent years, following in the footsteps of US president Donald Trump.
The Reform UK leader announced in May that his party would begin accepting donations in Bitcoin, and called for the Bank of England to create a “strategic reserve” of the digital asset.
He added the Bank was “turning their back on it [cryptocurrency] completely”.
In a speech earlier this week, the bank’s Governor, Andrew Bailey, said: “Crypto of the Bitcoin variety falls into the risky investment category, whereas stablecoins used for retail and wholesale payments, rather than just to support crypto trading, fall into the money category, or should do.
“Understanding the implications of this distinction is important for designing the approach to regulation.
“But, I will go further than that and say it should enable better stablecoins to emerge than would do in a world in which the distinction was not understood and followed up.”
In July, it was reported by the Telegraph that the Chancellor, Rachel Reeves, could sell of Bitcoin in the UK worth at least £5billion.
The Home Office was reportedly working with police forces to flog the seized cryptocurrency, with the move easing pressure on the Treasury.
Ministers were also planning to start an official crypto storage system that would handle sales of Bitcoin and other digital currencies.