Elsewhere, Bitcoin, which is the largest cryptocurrency, scaled above $70000 on Thursday, the highest level it has hit in over 4 months since November last year. The rally comes at a time when spot Bitcoin exchange-traded funds ETFs are receiving huge investments from retail and institutional investors. Based on CryptoQuant data, the newly launched spot Bitcoin ETFs have experienced the third day of a positive net inflow, with more than $500 million sent to them on Wednesday only.

This is specifically true in the emergence of the backing of Bitcoin ETFs that has been popularised in the current years. This analysts link this level of enthusiasm to rising acceptance within the mainstream market for cryptocurrencies and the entry of institutions into the market. The opportunity to get exposure to digital assets without actually owning crypto has become possible due to the approval of spot Bitcoin ETFs by the U.S. Securities and Exchange Commission (SEC) earlier this year.

What is also interesting, with further Bitcoin growth, the total cryptocurrency market cap has also gone up to $2.5 trillion and above. This resurgence has again brought into focus the debate of Bitcoin as an inflation shelter or a store of value. A common narrative that many supporters often give is that Bitcoin is an excellent hedge against traditional assets because a max of 21 million Bitcoins can be mined.

The recent price move has also revived interest in altcoins, and Ethereum, the second most popular digital currency based by market capitalization, also scored its own wins. This has in the meantime pushed Ethereum’s price above $3 500, which is its highest level in the third month of 2022. General trading activity has risen throughout the_crypto market boosting key exchanges’ daily trading volumes to $100 billion and above.

But many players on the market are still skeptical about the current rally and do not exclude its failure. Others opted for the approach emphasizing risks and bringing up the examples of possible market oversaturation and stressing that investing in crypto currencies is always risky. The possibility of getting a fast return on investment is seen as dangerous because the price could soon plummet, prevented by regulatory issues or changes in macroeconomic indicators.

Nevertheless, the rate of cryptocurrency adoption in institutional investors is still persistent. Several top banks have declared that they are either planning to incorporate more cryptocurrencies into their services, or already have plans to incorporate Blockchain into their services. More participation from the traditional finance participants is being viewed as a positive sign concerning the future of the cryptocurrency industry.

The theme that has been put to rest with the surge and the constant rise is the environmental cost of mining bitcoins. While the network’s hash rate is setting new record highs, issues concerning energy consumption and, therefore, emissions come back into focus. A few industry participants have been calling for increased reliance on renewable energy in mining operations to mitigate these costs and enhance the stability of the Bitcoin network.

Given the nature of the crypto market and the high level of innovation that is currently defining this market space, there are questions as to how the different governments should regulate this market properly. Although some countries actively use cryptocurrencies and blockchain technology in their economies today, others are more conservative. The constant changes in the regulatory systems will definitely continue to determine the destiny of the cryptocurrency space and its adoption in the existing financial system.