Bitcoin has retreated from its all-time high of $61,000 over the weekend, edging down more than 8% in intra-day trading as investors took stock of the record.
The world’s largest cryptocurrency rose above $60,000 in value on 14 March to reach a high of $61,627, according to data from crypto exchange Bitstamp. Its total market value exceeded $1tn last month.
The recent surge in price had been forecast by analysts due to the US stimulus package approved last week.
However on 15 March, the cryptocurrency began to slip in value once more. Bitcoin fell as low as $55,183 just after midday GMT, before recovering slightly to above $57,000 by 2pm.
The decline in price came as Reuters reported that Indian officials are weighing a ban on cryptocurrencies, with penalties for mining or owning the digital assets under consideration.
The swings in price volatility have regulators concerned about bitcoin’s recent adoption by major institutional investors, which has seen the likes of Tesla, Square and MicroStrategy jump on the bandwagon.
Banks have also begun to demonstrate interest in the cryptocurrency, as JPMorgan filed a proposal for a cryptocurrency-exposure basket earlier this month. Goldman Sachs has relaunched its cryptocurrency trading desk, with a plan to offer a bitcoin ETF and non-deliverable forwards.
“Whether crypto cynics like it or not, there’s no getting away from the fact that bitcoin is becoming an increasingly important part of the global financial system,” said Nigel Green, chief executive of financial advisory firm deVere Group.
“The move towards digital currencies is going to increase — and at pace — over the next few years. This is why financial regulators must now make regulation of the crypto sector a major priority,” Green said.
“With a growing dominance, bitcoin and other cryptocurrencies must be held to the same standards as the rest of the financial system with a robust, workable international framework.”
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