Bitcoin achieved an all-time high of $47,725 today following the news yesterday that Tesla would be adding the cryptocurrency as a payment option to buy its cars and that it had purchased $1.5 billion worth of the asset. The last high was around $41,000 in the first week of January before the price began steadily decreasing.
Before the news yesterday, Elon Musk also changed his Twitter bio towards the end of January, simply to "#bitcoin". This immediately caused a spike in the price after his followers rightly assumed it was an endorsement for the cryptocurrency. He later tweeted that the spike was inevitable, in retrospect.
In retrospect, it was inevitable
— Elon Musk (@elonmusk) January 29, 2021
What’s happening now is a little bit unprecedented in bitcoin history; in previous years the price hit a significant all-time high and would then retreat for a lengthy amount of time before setting course again for a new high. The Winklevoss brothers bought into bitcoin several years ago but it did not have the same impact that Elon Musk’s endorsement has had.
As always, if you are thinking about buying some bitcoin you must ensure you’re only spending what you can afford to lose. The price of bitcoin is very volatile and can lose thousands of dollars worth of value overnight. You should also familiarise yourself with any tax rules surrounding bitcoin and whether it’s even legal where you live; India was recently looking to ban bitcoin.