Bitcoin increased by about 5.2% and is now trading around $ 57,000. In February, it topped $ 1 trillion for the first time, hitting a record $ 58,350.
The gain came even as US consumer prices rose lower than expected in February, which suggests that broader inflationary pressures remain subdued. Bitcoin advocates defend the digital asset as a hedge against a future surge in inflation.
But even if hitting $ 1 trillion is very noteworthy, many said that assigning market capitalization is not an accurate representation, since Bitcoin is not a company nor an asset. Skeptics say that with no real assets owned by companies or government support like the dollar, investors are only buying faith in the cryptocurrency network.
Ether, the second largest cryptocurrency in the world, has grown by 3%. The rally reflects broader risk optimism following the Nasdaq 100, which recovered this week from an earlier decline that pushed it into a correction.
Bitcoin proponents argue that the digital asset is a storage of value that can be used as a hedge against inflation and a weakening dollar, while detractors contend that the cryptocurrency is in an incentive-fueled bubble that is likely to burst.
