Bitcoin nears all-time high, but rally is much different than 2021 record run

Welcome back to Distributed Ledger. This is Frances Yue, crypto and markets reporter at MarketWatch.

Bitcoin
BTCUSD,
+6.88%
is seeing an impressive rally, as the crypto topped $64,000 briefly on Wednesday, touching levels not seen since its record peak in November 2021.

The No.1 crypto was last up more than 5% at $61,385, reaching as high as $64,037 at one point during the session. The crypto is roughly 11% away from a record of $68,990 reached 27 months ago.

Still, the recent bull run is different from the one in 2021, according to Ian Rogers, chief experience officer at crypto wallet company Ledger.

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A different bull market

The current rally is mostly driven by financial institutions, as bitcoin exchange-traded funds attracted new capital from asset managers and retirement platforms into the crypto space, Rogers said in a call.

Read: 5 ways bitcoin ETFs are already changing how crypto is traded

While the U.S. saw a “raging retail market” in 2021, such a craze has yet to show up in the current cycle, Rogers said, citing his observations at Ledger, which mostly serves retail investors.

Google searches of bitcoin also remain sigficantly lower from 2021, according to data from Google Trends.

“When bitcoin was approaching its record high in 2021, everybody was talking about it. But now not that many people are talking about it,” Rogers said.

Once more retail investors participate, it could drive bitcoin’s price even higher, according to Rogers.

Meanwhile, in 2021, when bitcoin reached its record high, there was “tons of leverage” being used, Rogers said. A lot of that was flushed out after a number of crypto companies collapsed, including crypto exchange FTX and its affiliated hedge fund Alameda Research.

Bitcoin is now approaching its record high with less leverage than 2021, which is bullish for the crypto, Rogers said.

Record volume for bitcoin ETFs

Spot bitcoin ETFs excluding Grayscale Bitcoin Trust
GBTC
are on pace to record a new high of daily trading volume on Wednesday, according to Dow Jones Market Data.

The total volume of the nine bitcoin ETFs traded as of Wednesday afternoon hit 115 million shares, exceeding the previous record volume of 70 million shares which occurred on Jan. 11, their first day of trading.