Bitcoin continued its blistering start to 2021, crossing $40,000 for the first time on Thursday.
The price traded as high as $40,324, according to CoinDesk, up 14% on the day and as much as 38% on a year that is only seven days old. The digital currency didn’t hold the $40,000 level for long, though. It settled at $39,595.92, up 10%.
Bitcoin’s rally has been turbocharged in recent days—it crossed $30,000 for the first time on Saturday, then powered through $36,000 and $37,000 on Wednesday, before setting three new $1,000 milestones on Thursday.
“Rallies like this that are driven by FOMO [fear of missing out] alone, with loose logic applied later, aren’t sustainable,” said Oanda analyst Craig Erlam. “But they can certainly produce extraordinary returns in the meantime.”
Bitcoin’s price has been rising for months in conjunction with stocks, emerging markets and commodity prices as investors have flocked to riskier assets in response to the aggressive monetary policies enacted by central banks to combat the economic collapse caused by the coronavirus pandemic.