Bitcoin broke another record in less than 24 hours and reached a value of an incredible 23,655 dollars. In the past year, the value of the oldest and most sought-after cryptocurrency has grown by more than 220 percent.
As of yesterday, Bitcoin has exceeded the psychological limit of $20,000, and in just one day, its value has increased by 10.5 percent.
A slightly lower-ranked cryptocurrency, Ethereum, whose value usually runs parallel to Bitcoin, has risen by about 8 percent since yesterday.
The value of Bitcoin “exploded” thanks to the huge interest of investors, primarily because of the possibility for quick earnings, but also because of the protection of investments.
Investors believe that investing in cryptocurrency is a kind of protection against inflation, given that many governments and central banks have “turned off the taps” in response to the crisis caused by the pandemic of Covid-19.
The search for alternative currencies worth investing in continues, primarily due to the constant depreciation of fiat money(traditional currencies)
according to an analysis by Deutsche Bank experts.
Precisely because of that, it is expected that the demand for Bitcoin will continue to grow, and thus its price.
Cryptocurrencies appeared a decade ago, but were notorious and were mostly associated with crime and market disturbances.
Only in the last few years have they attracted the attention of the mainstream market.
Bitcoin is still less controlled than other “traded” goods.
However, large investors have become less skeptical of cryptocurrencies since they became more available for trading, primarily thanks to better stock market infrastructure.
The rise of Bitcoin in the last year is a consequence of the expectation that this cryptocurrency will become one of the usual payment methods, but also because Pay Pal opened its network for cryptocurrencies.
It is estimated that pension funds could also invest in cryptocurrencies
Analysts say the latest price spike was prompted by big investors like Paul Tudor Jones and Stanley Druckenmiller who “moved” their funds into cryptocurrencies, and technology companies like Square and MicroStrategy have also focused on buying Bitcoin.
The latest record value of Bitcoin has reminded many observers of the market of its huge growth since 2017, when it approached the price of almost 20,000 dollars, after which it suddenly dropped to the level of approximately 3,000 US dollars the following year. Many analysts are willing to argue that such a scenario will not happen this time.
This growth in value is just a confirmation, cryptocurrency fans believe, that Bitcoin will become an inevitable part of the portfolio of every serious investor in the future, a kind of “digital gold” in which assets will be able to be stored for a long time and safely.
Thus, JPMorgan estimates that institutional investors around the world, including pension funds, could invest as much as $600 billion in Bitcoin.
The recent investment of the American insurance company Mutual Life Insurance in Bitcoin in the amount of 100 million dollars best illustrates the potential for further demand of institutional investors in the coming years, they wrote in the report from Friday.
This could greatly strengthen the role of Bitcoin, we could really talk about its mass use, Bitcoin would open the way from family offices and cryptocurrencies of rich individuals to one of the biggest players in the financial market.
Of course, no one has the illusion that insurance companies and pension funds that have a conservative policy(investment security comes first) would risk a higher stake, but some percentage of their portfolio could be invested in cryptocurrencies, which should be at their expense.
Of course, this will also have a positive effect on the value of cryptocurrencies in the long run.
It’s all over the news
Let’s see what various market news are saying:
According to the data of the trading platform Coindesk, Bitcoin is currently trading at the level of about 22,200 US dollars, reports Russia Today.
With the latest price rise, which, according to analysts, is driven by stronger demand from large institutional investors, the market capitalization of Bitcoin exceeds $410 billion, which is, for example, more than the market value of a JPMorgan or Johnson & Johnson. Many traders and investors are now looking carefully at their options and Bitcoin investment site.
Other major cryptocurrencies also saw double-digit growth. Ethereum strengthened by about ten percent, and Ripple’s XRP took off by 23 percent.
Earlier this week, the Chicago Stock Exchange(CBOE) operator announced plans to launch a cryptocurrency index next year in partnership with New York based trading software firm Coin Roots. The index will track data on the trading of several cryptocurrencies with a high market capitalization.
After breaking the record of 20,000 dollars on Wednesday, Bitcoin today reached a new record value and a jump of as much as 12% to 23,421 dollars, according to data from the company for the analysis of cryptocurrency Coin Metrics.
According to the media, on Wednesday, at 22:54, Bitcoin was worth 21,298 dollars, while its value this morning exceeded 22,000, and soon 23,000 dollars.
The most valuable cryptocurrency continues to grow, and only during this year, it recorded a triple jump in value.
Just two weeks ago, Bitcoin crossed the $20,000 mark for the first time, and since then the dizzying rise has continued, which has jumped by more than 400 percent this year, the Guardian reported.
This cryptocurrency welcomes the end of the year with the highest value ever.
At the beginning of the year, it didn’t look like that. From mid-February to mid-March, its value fell by more than 50 percent – to only $4,895. The lowest value of Bitcoin this year was in March and it amounted to 3,600 dollars.
In November, Bitcoin was hovering around $16,000.
Let us remind you, Bitcoin almost touched the value of 20,000 dollars at the end of 2017, but then it fell.