Bitcoin smashes through R1.6 million exceeding all-time high on Luno

Cryptocurrency leader Bitcoin smashed through its previous all-time high of R1,321,541 million recorded on 3 June 2024 and was this morning trading on Luno at R1,618,339. The milestone followed an extraordinary rally which saw Bitcoin up a remarkable 10% over 24 hours.

Following the US elections, Bitcoin reached a new all-time high in dollar terms, trading at $89,214 on Luno this morning. The surge has also been linked to increased institutional interest, with BlackRock’s BTC ETF also recording record inflows of over $1 billion.

Christo de Wit, Luno’s country manager for South Africa, comments, “Many analysts attribute Bitcoin’s recent rally to expectations of a more crypto-friendly regulatory environment in the US under Donald Trump’s administration, which they believe could ease restrictions and boost investor confidence in digital assets.” 

Not to be outdone, Dogecoin surged by 40% overnight, doubling its price in just seven days. Major coins across the market have likewise posted impressive gains, with the total crypto market cap crossing the $3 trillion mark.

Luno, South Africa’s largest crypto investment app and a licensed financial services provider, says that its active transacting customer base has reached a multi-month high, with notable growth from the previous month. The recent price surge has also driven a significant rise in weekly trading volumes on the platform in South Africa. 

When prices reach all-time highs, many Bitcoin holders who have hodled (crypto-speak for held) through the price slumps feel validated for staying focused on its longer-term prospects. But Bitcoin has had many dips and rebounds. After hitting a trough in 2019, prices bounced back during Covid and then plummeted again in 2021. There was another rebound later in 2022 but the market experienced another downturn. While Bitcoin has been volatile throughout the various cycles, when taking a broader view on the market, it has achieved growth momentum.

The 2024 rally began in earnest after Bitcoin exchange-traded funds (ETFs) were approved by the US Securities and Exchange Commission on 10 January 2024. Spot ETFs are designed to track the price of Bitcoin but don’t require investors to hold the token themselves. 

Says de Wit, “The influx of institutional capital via ETFs is evidence of a positive shift in how cryptocurrencies are viewed by traditional investment institutions.”

Risks and volatility

Volatility remains a characteristic of the crypto market, which is a relatively new asset class. Volatility is still driven by the classic principle of supply and demand. Therefore, depending on its impact on your overall portfolio, volatility should be a factor in your decision to enter the market. 

Avoid crypto investing pitfalls

The crypto market is unpredictable. For most investors, the safest option is to buy assets with good utility and hold them for years. That strategy is slow and boring for some but it’s often the most profitable.

●     Do your research – Luno advocates responsible investing, which starts with research.  What is a cryptocurrency, how does it work and what problems does it solve? Ensure you get your information from credible sources and do your due diligence before investing. Luno has a Discover page as a free learning portal.

●     Don’t invest more than you can afford to lose – you could easily get caught up in the excitement, but it is important to stay level-headed. Crypto prices rise and fall, sometimes sharply. Use a credible platform like Luno with proven safety and security measures to keep your money safe. If something sounds too good to be true, it usually is. Set realistic goals – consider investing smaller amounts regularly to grow your Bitcoin slowly and steadily. Sometimes you will invest when the price is higher and sometimes lower.

●     You don’t need to buy a whole Bitcoin – one Bitcoin currently goes for over R1,6 million but you can buy a fraction of a Bitcoin for as little as R10 on Luno.