Bitcoin climbs to near-record high, gaining 12% in past week: CNBC Crypto World

Bitcoin Nears Record High as Investors Seek Stability Amid Economic Uncertainty

Imagine if your favorite store suddenly closed for repairs, and everyone rushed to a new shop—this is a bit like what’s happening with Bitcoin as the U.S. government shuts down. Let’s break down why this matters for investors like you.

What’s Happening With Bitcoin?

Bitcoin, the most well-known cryptocurrency, just got very close to its highest price ever. On Friday, it was trading at about $123,874—just a hair under its all-time high of $124,000. This week alone, Bitcoin jumped up 12%!

The reason? The U.S. government shut down because lawmakers couldn’t agree on funding. With the government closed, people are looking for other places to put their money, and many are choosing Bitcoin.

Why Does This Matter For Investors?

When the government shuts down, it can make people nervous about the economy and the value of the U.S. dollar. Investors often look for “safe havens”—places to keep their money where they think it will be safe or even grow. That’s why Bitcoin and even gold are getting more attention right now.

  • Bitcoin surged 12% this week.
  • Gold prices also went up by over 2% this week.
  • Even the stock market had a small bump—the S&P 500 rose 0.5% and the Nasdaq 0.27% on Friday.

Bull Case: Why Some Investors Are Excited

  • Bitcoin is seen as a “decentralized” asset: It’s not controlled by any one country or government, so it feels safer when governments have trouble.
  • Past performance during uncertainty: Standard Chartered predicts Bitcoin could soon hit a new high and even reach $135,000.
  • People are looking for alternatives: When trust in the government drops, Bitcoin and gold often become more popular.
  • Bitcoin is more mainstream now: Unlike past shutdowns, more big investors and funds are involved, giving it more staying power.

Bear Case: Reasons to Be Cautious

  • Bitcoin is still very risky: Its price can jump up or down quickly—sometimes for reasons that are hard to predict.
  • Government shutdowns don’t always boost Bitcoin: During the 2018-2019 shutdown, Bitcoin barely moved because fewer people trusted it at the time.
  • Regulatory risks remain: Governments could still make rules that hurt cryptocurrencies, especially if they become too popular during crises.
  • High prices can mean big drops: In 2022, Bitcoin lost over 60% of its value in one year after hitting a record high the year before. [Source]
Related:  Key Midday Stock Movers: WYNN, RCAT, SNDK, PLTR Signal Shifting Investor Trends

How Does This Compare to the Past?

In the last big U.S. government shutdown (late 2018 to early 2019), Bitcoin didn’t do much. But a lot has changed since then. More big investors own Bitcoin now, and it’s easier to buy and sell. Plus, more people see it as a real alternative to cash or stocks.

Gold has always been a safe haven during uncertain times. In fact, during the 2008 financial crisis, gold prices rose over 25% in just one year. [Source] Bitcoin is starting to play a similar role for some investors today.

Investor Takeaway

  • Don’t chase the hype: Bitcoin’s price is near its peak, but big swings can happen fast. Only invest what you can afford to lose.
  • Diversify: Spread your money across different types of investments—like stocks, gold, and cash—to lower your risk.
  • Watch government news: Political uncertainty can boost “safe haven” assets, but it can also disappear quickly if the situation improves.
  • Check your risk tolerance: If you don’t like big ups and downs, consider safer choices like gold or high-quality stocks.
  • Stay informed: Read updates from trusted sources and pay attention to both positive and negative news in crypto and other markets.

For the full original report, see CNBC

Similar Posts