Recent Trends in Bitcoin Price
For the first time, Bitcoin increased to a value of $40,000 per coin, amplifying twice in value in less than 4 weeks and causing the total market value of all cryptocurrencies to surge past $1 trillion.
According to CoinDesk, world’s leading news platform for bitcoins and other digital currencies, Bitcoin soared past $38,000 last week on Thursday, confirming that this caused the total value of the whole crypto market to go beyond $1 trillion, making this the first such instance.
Reports from Coin Metrics & CoinGecko on Crypto Market
According to the data reported by Coin Metrics, the leading digital currency crossed an all-time limit of $38,080 at around 7 a.m. ET, only a couple of hours after it had surged past $37,000. As compared to the preceding day, Bitcoin had increased by a factor of 7%. Bitcoin, when compared with the beginning of the year 2021, has increased by 30% and has shown a dramatic increase of a whopping 370% during the last whole year, i.e. a period of 12 months.
In the meantime, data from Coinmarketcap reported that the total value of the entire crypto market, which is composed of bitcoin and all other digital currencies like ethereum and XRP, climbed beyond $1 trillion. The most dominant and well performing digital currency so far is Bitcoin, whose market value is approximately above $700 billion. To know more about Bitcoin visit bitcoinprime.io.
According to the data from tracker CoinGecko, cryptocurrencies hit the milestone of this market value after it increased by five times during the last year. Among the reasons which have caused this rapid increase in the value of cryptocurrencies, market analysts have identified the retail trader’s demand, quant funds which follow the ongoing trends, and the rich/institutional investors, to be the most significant factors contributing to this surge in value. Upon the analysis of composition of digital currencies’ prices by Bloomberg, it can be seen that the value of Bitcoin climbed by 11% during last Thursday, upto $40,065 and has surged by more than four times its value at the same time during the last year. Bitcoin makes up about two-thirds of the total crypto market value, and ethereum, another digital currency lies behind it, occupying 13% of the total market value.
Bitcoin has defied all the skepticism proposed by the doubtful analysts and investors, and according to Antoni Trenchev, co-founder of Nexo, a cryptocurrency lending firm, bitcoin is outperforming all the other cryptocurrencies like it has always done in the previous years and throughout the decade. He believes that instead of figuring out the best shares to buy now in the stock market, investors should look to diversify their portfolios with the addition of cryptocurrencies. Due to this rapid increase in the trade volumes, there has been a massive traffic of active investors signing up and trading on exchanges. For example, Coinbase Incorporation, the leading digital currency exchange platform claimed to experience “connectivity issues”, on its mobile app as well as browser website for two days.
Although digital currencies have been a prominent feature of the global financial market, many investors and analysts fear it will collapse someday, while others question the integrity of the cryptocurrency market. Supporters of Bitcoin debate that it provides the investors with a security against risks such as dollar inflation, similar to commodity gold. However, the critics believe that it is illogical and unreasonable to compare the aforementioned two assets.
A Final Word
Geoffrey Morphy, president of Bitfarms Ltd. – a cryptocurrency mining company located in Canada, believes that as investors realize the decrease in the value of assets they hold, especially the liquid ones, their inclination towards alternatives tends to increase.
A few traders and analysts signaled to JPMorgan’s Bitcoin price prediction in the longer run of $146,000 as a possible reason behind the rally. Others, however, identified that a regulatory update allowing a range of coins with lower volatility to be used by banks for payments encouraged the rapid investment in bitcoins and other cryptocurrencies.
According to multiple sources, the number of active Bitcoin accounts are approaching an all-time high level, similar to that of December 2017. This could possibly indicate that a few crypto-holders are preparing to sell. Less than 2% of the total bitcoin accounts hold 95% of the Bitcoin supply, therefore some huge trades can influence the bitcoin values, similar to the previous big Bitcoin roar back in November-December 2017.
