Bitcoin has just reached a record, will it continue to grow?
The news that the value of Bitcoin jumped to a new record level of all time and reached the figure of more than 40,000 dollars for the average Internet user was probably not overly exciting.
However, for those who have already “dug up” their coins, the price of cryptocurrency, which has reached its historical maximum, is certainly a great start to 2021.
The value of Bitcoin has been growing since 2017, when it was worth less than $1,000. The current jump began in October, as PayPal launched a service to buy, sell and pay with that cryptocurrency.
U.S. analysts believe that traditional investors have just started using Bitcoin, and reputable Wall Street analysts have begun to follow the exchange rate of this cryptocurrency.
The growth of Bitcoin, in all likelihood, will not end at this figure.
Bloomberg reported the report of JP Morgan analyst, which states that the most important cryptocurrency could reach the level of 146,000 US dollars because it competes with gold as an “alternative” currency.
It will certainly be a multi-year process, which proves that investing in this cryptocurrency should be viewed as a long-term investment.
Crazy bitcoin ride
From the very beginning, the Bitcoin exchange rate is subject to large oscillations.
First, there were ups and downs of several tens of euros, and soon it started to be hundreds and thousands of euros.
The cryptocurrency industry suffered a strong blow when in 2018, the price of one Bitcoin dropped from almost 20,000 dollars to only 4,000. At the beginning of May of the same 2019, the price rose to just over 5,300.
The New York Times wrote in 2019 that this proves the difficulties that Bitcoin faces on its way from the periphery of the Internet to the mainstream, despite Wall Street entering the market that was supposed to bring legitimacy.
However, the year 2019 ended in a conciliatory note for Bitcoin investors, despite the fall in prices since the summer, and 2020 ended with a historic price.
The fluctuating value illustrates nothing better than stories like the legendary one about a man who bought a pizza for 10,000 BTC(which was $30 at the time), and today’s value of 10,000 Bitcoins is more than $80 million.
The same basket includes the story of a reporter who paid for a dinner of 10 Bitcoins in a restaurant in 2013, which was about a thousand dollars at the time.
The owner kept the Bitcoins, which are worth much, much more today.
Uncertain elections – uncertain stock market
Even before the election year, it was assumed that the presidential elections in America would play a significant role in the value of Bitcoin.
Analysts predicted that investments in cryptocurrency would increase due to the uncertain election result, which also means turbulence on the stock market.
It is also possible that this is a growth in demand, and certainly PayPal has played an important role as a payment services giant that has accepted digital currencies as a means of payment and marked a step towards the commercial use of cryptocurrencies.
PayPal users in the US will in future be able to buy, sell and store Bitcoin through the platform, the US company announced in October.
And from the beginning of this year, payments via cryptocurrencies will also be enabled in retail via PayPal.
Some experts believe that the fact that a large number of young people entered the market and started trading Bitcoin in the past year also played an important role.
“The Economist” writes that the jump in value definitely has to do with the entry of big players from Wall Street, although the cryptocurrency market is still prone to large oscillations.
This would partly solve market regulation. An important signal in that direction is the European Commission’s proposal from September last year for common, unified rules that could enter into force at the end of 2022 and thus create security for investors.