Bitcoin Just Hit a New All-Time High. But Is the Leading Cryptocurrency a Buy?

Core Viewpoint - Bitcoin has reached a new all-time high of $118,856, surpassing its previous peak of $111,560, indicating strong market momentum and investor interest [1] Supply Dynamics - Approximately 94% of all possible bitcoins have been mined, with around 20% of the supply believed to be permanently lost [3] - The upcoming halving in April 2024 will reduce the daily output of new bitcoins from 900 to 450, tightening supply further [3] - The current supply situation is optimal for buyers, as demand is increasingly driven by institutional investors rather than retail enthusiasts [4] Institutional Demand - Bitcoin exchange-traded funds (ETFs) saw net inflows of $4.6 billion in June, reducing the public float available for new investors [5] - Major companies, such as Tesla, are maintaining significant Bitcoin holdings, with Tesla holding 11,509 coins valued at nearly $1.4 billion [6] - New Bitcoin treasury companies are emerging, focused on acquiring and storing bitcoins, further constraining supply [6][8] Government Interest - Governments are exploring or accumulating Bitcoin, with the U.S. planning to create a Strategic Bitcoin Reserve (SBR) to hold forfeited coins [9] - This institutional and governmental interest contributes to a competitive environment for Bitcoin, as various entities vie for a limited supply [10] Market Sentiment and Conditions - Current market conditions are healthier compared to the 2021 crypto bull market, characterized by ETF-driven demand and increased regulatory clarity [12] - Investor sentiment appears cautious rather than exuberant, indicating a more stable market environment [13] Investment Strategy - Dollar-cost averaging is recommended as a strategy to mitigate the impact of market volatility, allowing investors to buy a fixed amount of Bitcoin regularly [16] - With tightening supply and increasing institutional interest, the current price level may be a temporary milestone rather than a peak [17]