Bitcoin remained close to the $50,000 mark after briefly surpassing this significant level for the first time in over two years, marking a notable resurgence from past crypto scandals and setbacks that questioned the industry's sustainability.

The primary digital asset surged to a peak of $50,328 on Monday in the US and was valued at $49,980 as of 7:40 a.m. on Tuesday in Singapore. Since the beginning of last year, its value has tripled following a 64% decline in 2022. Bitcoin still sits below its record high of nearly $69,000 reached in November 2021.

The volatile price swings witnessed since Bitcoin's inception over a decade ago have consistently enticed speculators. Initially presented as an alternative to the conventional financial system, the recent surge is fueled by optimism stemming from last month's US endorsement of spot Bitcoin exchange-traded funds, indicating broader acceptance within mainstream markets.

Matt Maley, chief market strategist at Miller Tabak & Co., remarked, "There's considerable discussion surrounding the influx of capital into this asset. Additionally, it's worth noting that momentum players are becoming increasingly enthusiastic."

The revival in cryptocurrency prices coincides with anticipation of relaxed monetary policies, enhancing the attractiveness of higher-risk assets. "The growing appetite for risk has extended to digital assets," stated Chris Newhouse, a DeFi analyst at Cumberland Labs.

On Monday, shares of companies associated with cryptocurrencies experienced gains, including Bitcoin proxy MicroStrategy Inc. rising by 11%, trading platform Coinbase Global Inc. increasing by 3.8%, and miner Marathon Digital Holdings Inc. jumping by 14.2%. The positive sentiment may extend to Asian stocks linked to digital assets.

Bitcoin has regained all the losses it incurred since the May 2022 collapse of stablecoin TerraUSD, which triggered a series of failures culminating in the downfall of Sam Bankman-Fried's FTX exchange in November 2022.

When FTX collapsed, the crypto market had already been in decline for several months, resulting in the downfall of hedge fund Three Arrows Capital and lender Celsius Network. However, the collapse of FTX, previously one of the leading crypto exchanges in terms of trading volume, had even more severe consequences, as token prices remained stagnant due to dwindling liquidity.

With Bankman-Fried convicted of fraud and Binance exchange's co-founder Changpeng Zhao awaiting sentencing for US sanctions violations and failure to implement anti-money laundering policies, analysts perceive fewer imminent risks to the industry, leading to an increase in crypto prices.

ETF inflows

Nine US spot Bitcoin exchange-traded funds debuted on Jan. 11, while the more than decade-old Grayscale Bitcoin Trust converted into an ETF the same day. The accessibility of ETFs promises to widen the investor base for the token. The new funds have attracted about $9 billion so far, while a more than $6 billion outflow from the Grayscale fund since its conversion seems to be losing steam.

"Enthusiast buyers bring in more enthusiast buyers pushing prices further up,” said Fadi Aboualfa, head of research at crypto-custodian Copper Technologies Ltd. “The cryptocurrency has momentum on the back of several green weeks and has a large chance of going up further when markets see weekly movements upwards of 10% (as we saw last week).”

Positive sentiment regarding the upcoming quadrennial Bitcoin halving in April is spreading throughout the cryptocurrency community. The halving reduces the amount of Bitcoin awarded to miners who operate the powerful computers that validate transactions on the blockchain. This event is often considered a price support mechanism based on historical patterns.

Additionally, aside from the influx of funds from ETFs, sentiment toward Bitcoin is generally optimistic during the Lunar New Year holidays currently ongoing in Asia, as noted by Fundstrat Global Advisors.