Bitcoin reaches market capitalization of $1 trillion

Bitcoin continues its bull run and is worth $1 trillion for the first time since 2021. At the time of writing, 1 BTC costs $51.326/€47.955. This means digital gold has risen 20 percent in the past seven days. In fact, within 12 months, the price has risen 129 percent.

Bitcoin has exceeded one trillion US dollars several times in the past. The cryptocurrency last broke through this barrier on Dec. 4, 2021 - albeit on the downside. The cryptocurrency then went into hibernation for about a year before bottoming out at $15,700 in November 2022.

At USD 1 trillion, BTC is once again among the world's ten largest assets - right behind Meta (USD 1.17 trillion) and silver (USD 1.24 trillion). Yesterday, Tuesday, Feb. 13, BTC was down slightly as the US inflation rate fell marginally. The latest price gains are due in no small part to Bitcoin ETFs. Demand for Bitcoin-based securitized index funds is so high that BlackRock, Fidelity and others own more than 200,000 BTC. Every day, ETFs extract significantly more BTC from the market than the miners produce - this drives up the scarcity of assets and their price.

Market capitalization is the arithmetic total value of a security (currency bills, stocks or bitcoin). Originally, it comes from the stock market and is calculated by multiplying the number of shares in circulation by the stock price. In the case of Bitcoin, market capitalization is the product of the volume in circulation (about 19.6 million BTC) multiplied by the current price.

With the upcoming Bitcoin Halving, the upcoming period is quite bullish. The Bitcoin halving is a major event that takes place about every four years, where the reward for mining a new block is halved. This mechanism is built in to combat inflation and limit the availability of new bitcoins, eventually bringing the total supply to 21 million. Historically, the halving has often led to an increase in the price of Bitcoin in the months following the event.