Bitcoin surges after shocking week

Bitcoin continues to rebound from its lows for the year, and investors are now trying to understand why.

The cryptocurrency sank below the key $30,000 threshold Tuesday, at one point briefly erasing all its 2021 gains. It later recovered to turn positive for the day.

But now Bitcoin is climbing back above the $34,000 mark to trade as high as $34,367 in early morning trading.

Up 3% on the day

Smaller rivals also surged, with ether rising 6% to $2,014 and XRP up 9% at a price of 64 cents. The reason for the moves higher wasn’t clear, but cryptocurrencies are known for their volatility.

Bitcoin had a solid start to the year, rallying to an all-time high of almost $65,000 ahead of crypto exchange Coinbase’s blockbuster debut and as institutional investors appeared to be warming to it.

But the world’s biggest digital coin has been on a roller-coaster ride since, almost halving in value amid a slew of negative news.

Thanks, Elon

The slide began when Elon Musk first raised concerns over the crypto’s environmental impact. Suddenly, the world looked towards other cryptos for hope.

In China, authorities have been clamping down on bitcoin mining, the power-intensive process for validating transactions and generating new bitcoins.

Over the weekend, Beijing’s crackdown on crypto mining extended to the hydropower-rich Sichuan province.