Bitcoin briefly rose above the $39,000 threshold after six consecutive days of positive trading, rebounding after a run of price falls for the cryptocurrency.
Bitcoin’s price touched $39,544 around 2am BST on 26 July, jumping more than 10% from its 24-hour low of $33,890. The token had settled around the $38,600 mark as of 8:30am BST.
The cryptocurrency had struggled to move significantly above the key $30,000 threshold for several days as bitcoin found a new bottom following several major flash crashes earlier this year that saw the coin topple from its all-time high of $64,829 in April.
Cryptocurrencies such as bitcoin have been struggling across the board amid rising regulatory scrutiny of exchanges such as Binance, and a lack of movement on approving broader crypto regulation.
The price swing comes as Binance chief executive Changpeng Zhao said the platform had started limiting new users of its exchange to a maximum of 20 times leverage on positions, with plans to expand the change further.
“We didn’t want to make this a thingy [sic],” Zhao said in a 26 July statement on Twitter. “In the interest of consumer protection, we will apply this to existing users progressively over the next few weeks.”
Binance has faced criticism from global regulators over its offering of regulated products such as spot trading and derivatives linked to cryptocurrencies without proper authorisation, including in countries such as Italy, the UK, Hong Kong, Germany and Japan.
The platform also scrapped offering crypto-esque tokens linked to traditional direct stock holdings of companies such as Apple and Tesla earlier in July.
The crackdown by regulators caused appetite for cryptocurrencies to dwindle, resulting in lower volatility for tokens such as bitcoin.
Major industry figures such as UBS chief executive Ralph Hamers and Luke Ellis, the head of London hedge fund manager Man Group, have slammed the sector in recent days to say cryptocurrencies hold no underlying value.
“If you look at cryptocurrencies as a whole, it is a pure trading instrument. There is no inherent worth in it whatsoever. It is a tulip bulb,” Ellis told the Financial Times on 26 July, referring to the 17th century Dutch financial bubble.
Ellis said Man Group trades in cryptocurrencies alongside other markets, stocks and credits, viewing them as “things to trade because they go up and down a bunch”.
About 15% of family offices globally have exposure to cryptocurrencies, Goldman Sachs said in a 21 July study. Meanwhile nearly eight in 10 institutional investors say that digital assets should be included in portfolios, according to findings from Fidelity earlier this month.
UBS boss Hamers said earlier this month that the bank “still [finds] it difficult to see the fundamental value of some of these investment opportunities.”
“We feel that they are more speculative than an investment opportunity,” he added.
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