The price of bitcoin jumped to a six-week high Monday, with some investors attributing the rally to short positions being liquidated and speculation that Amazon.com Inc. may be venturing into digital currencies.
Bitcoin soared as high as $39,544.29, according to CoinDesk, reaching its highest level since mid-June. It is up 18% from its 5 p.m. ET level Friday, after briefly rising more than 20% earlier Monday morning. Rival currency Ether jumped more than 14%.
Recent bullish comments from high-profile proponents of cryptocurrencies have helped buttress the price gains. Last week, Tesla Inc. Chief Executive Elon Musk said he and his rocket company, SpaceX, held bitcoin, despite concerns about its environmental impact. Mr. Musk also said Tesla would likely accept the cryptocurrency as payment again if the process of generating it, known as mining, becomes less reliant on fossil fuels.
“There’s been a lack of good news in the cryptocurrency market in the last two months,” said Bobby Lee, founder and CEO of Ballet, a cryptocurrency hardware wallet. “Now they’re starting to trickle out, so investors and speculators are using this opportunity to build up their positions and buy back bitcoin, causing the price to rise pretty dramatically.”
Bitcoin is still about 40% below its high of nearly $65,000 in mid-April. The following month, China’s renewed efforts to crack down on bitcoin mining and trading contributed to sharp price declines.