Bitcoin surges back above $40,000 as bulls ignore Christine Lagarde's crypto warnings
Bitcoinsurged as much as 7.5% on Thursday, to $40,094.81.
- The red-hot
cryptocurrencyhas seen immense volatility in recent days, with thousands of dollars per coin added and wiped out across short periods.
- Thursday's surge comes after European Central Bank boss Christine Lagarde called for more regulation the prior day.
- Morgan Stanley analysts say bitcoin focus "unsurprising" given low bond yields
Bitcoin rose sharply once again on Wednesday evening and Thursday morning, climbing past the $40,000 mark.
It has been a volatile few weeks for bitcoin, with its price hitting an all-time high of close to $42,000 last week before paring. The price has consistently swung around 10% a day as investors buy in and cash out of the cryptocurrency, which has surged more than 330% in a year.Bitcoin climbed as much as 7.5%, to $40,094.81. Its smaller rival
On Wednesday, European Central Bank boss Lagarde said Bitcoin needs to be regulated on a global level and linked it to "totally reprehensible money laundering."Read more: The CIO of a $500 million crypto asset manager breaks down 5 ways of valuing bitcoin and deciding whether to own it after the digital asset breached $40,000 for the first time
She said bitcoin is not a currency, as many of its proponents argue, but a "highly speculative asset which has conducted some funny business".Bambos Tsiattalou, a financial crime lawyer at London's Stokoe Partnership Solicitors, said tighter regulation would be a major problem for cryptocurrencies. "Many people buy Bitcoin and other cryptocurrencies because they are worried about and don't trust fiat currencies," so greater regulation would demolish much of their appeal, he said.
They added: "Innovation in digital assets continues rapidly and will likely drive increased
institutional participation over time."
Yet the analysts cautioned that "the perception of 'value' and demand can vary materially, for example due to changing regulations."Read more: 'Vastly technically disconnected': A market strategist breaks down the 3 indicators that show Tesla is overpriced - and says it's due for a 17% correction in the next 6 weeks
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