Bitcoin Image Credit: Gulf News

Bitcoin climbed above $8,000, extending its longest winning streak since 2013 and giving fresh momentum to a cryptocurrency market that crashed only last year.

Just hours after leaping 25 per cent on Monday with no apparent explanation, the largest digital token added as much as 5.9 per cent on Tuesday. That helped push the crypto universe’s total market value to almost $250 billion - a level not seen since last August - as the 10 most-traded tokens also advanced.

Speculation over what’s behind the early-May surge runs from a possible squeeze on short positions to investor relief that recent hackings and scandals are getting resolved without disrupting the broader market. Crypto enthusiasts point to a long-standing claim - that their assets have become a haven during market turbulence.

“There’s been no shortage of explanations for the recent spike, some more ludicrous than others and none that are nearly significant enough to match the size of the leap we’ve seen,” Craig Erlam, senior market analyst at Oanda Corp. in London wrote in a note to investors.

Erlam said the rally, which has spilled over to many of the other 2,000-plus digital coins that trade, harks back to the frenzy that drove Bitcoin almost to $20,000 in 2017 before it crashed below $4,000 in the following year.

“Maybe we’ve seen Bitcoin recapture some the previous FOMO behavior,” he said in emailed remarks to Bloomberg. “People see it rising and jump on for fear of missing out.”

Bitcoin was 1.7 per cent higher as of 11:05 a.m. in London, paring its advance from as high as $8,331.38, according to Bloomberg composite pricing. Monday’s gain was the biggest one-day increase for Bitcoin since 2014, the data show.

The Bloomberg Galaxy Crypto Index, which tracks a basket of the largest digital assets, added as much as 9.3% before paring the gain to 4.8 per cent.