SINGAPORE (Reuters) – Bitcoin pulled back from a record high on Monday and other cryptocurrencies fell as investors took profit from a record-breaking rally that pushed bitcoin close to USD 50,000.
Bitcoin fell a staggering 5.6% to USD 45,914 in Asian trading hours after a record high of USD 49,714.66 on Sunday, while rival crypto-ethereum fell more than 8%.
Once on the fringes of the financial world, bitcoin is rapidly gaining legitimacy as an asset class and is up 20% in the week since electric carmaker Tesla Inc announced it had $ 1.5 billion worth of bitcoin and would accept the currency as payment .
It is up more than 60% for the year to date and is up more than 1,100% since hitting a one-year low in March last year.
“There is a genuine wave of big players (buying) that has continued to drive up prices,” said Chris Weston, lead research at Melbourne brokerage Pepperstone. “We may see one or two large funds just pay out,” he said.
“The big question is, okay, you want to buy the pullback, but how big is the pullback we’re talking about?”
In addition to Tesla’s investment, Bank of NY Mellon said last week that it has formed a new unit to help customers own and trade digital assets.
Bloomberg reported on Saturday that Morgan Stanley’s investment arm is weighing in on bitcoin.
Reporting by Tom Westbrook; Editing by Kim Coghill and Sam Holmes