As Bitcoin (BTC) has surpassed all records of the past and has unexpectedly crossed USD 60,000, it brings the same question to everybody’s mind as to why BTC exploded. Here are some of the reasons for the accelerated BTC price.
1. Global COVID-19 Pandemic
Most people looked at Bitcoin as a way to protect themselves from the looming economic downturn brought about by the spread of Coronavirus. Institutional investors such as Microstrategy, Tesla, Square Corp, and many others, shifted their cash holdings to BTC, claiming that it was a good store of value against inflation.
2. Many Have Begun to Consider it as ‘Digital Gold’
Although Microsoft founder Bill Gates has warned investors against risky cryptocurrency, crypto enthusiasts are considering BTC for investment and trading purposes as well as a payment system. Bitcoin is drawing a worldwide audience, and many consider it as ‘digital gold,’ considering the fact that it has many of the same properties as gold including rarity, liquidity, and volatility – acts as a globally recognized store of wealth.
3. Bringing Better Trust
In the beginning, Bitcoin was surrounded by various questions. Is it secured? Can it be hacked? Is decentralization a truly workable solution? Will halving destroy the system? Finally, after a decade, BTC has proven that it is secured, non-hackable, and built on a reliable technology (Blockchain) that cannot be broken down.
4. The Emergence of Financial Institutions
As Bitcoin is now being associated with more institutional investors and giant financial institutions like Paypal, Visa, JP Morgan, and trading platforms like Cryptrader etc., more retail investors are interested in purchasing Bitcoin now more than ever.
– Read more about the top 10 institutional holders of Bitcoin.
5. Highest Liquidity in the Crypto Space
Apart from what we have mentioned above, another crucial reason for its upsurging is that it has the highest liquidity in the crypto space. The higher the liquidity ratio, the easier it is to sell a cryptocurrency at market price.
Could Bitcoin really hit $100K?
As Bitcoin shows no long-term sign of slowing down, everyone is wondering whether BTC will achieve $100k in 2021 or not? Making a prediction is tough, especially if it’s about the financial future, but after looking at the features of the past data, we can gain some insight as to what the future could possibly look like. The latest advances in the field of Bitcoin are evidence that it is on its way to becoming a mainstream asset class. Blockchain Experts and analysts believe that if this trend continues, it wouldn’t be a surprise that BTC might hit $100k by the end of 2021.
From the above discussion, it is clear that the Bitcoin era has begun and it will continue to make a revolution in the years to come.
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If you are planning to trade in Bitcoin, it is crucial that you know trading strategies very well and conduct your own research before making any decisions.