Bitcoin, the most popular digital currency, has been surging up on top gear in the market around the past one week. As on January 1 2021, it has been confirmed that the value of bitcoin has reached the 3 million yen mark for the first time in history. Though other cryptocurrencies like Ethereum and Ripple have also done well, however Bitcoin has outperformed all. Presently, Bitcoin is worth $31254 and a volume of $36,899,779,014.
Why do you really think Bitcoin has got so much trust and investment in the market? Here are some factors that I considered, have played a prominent role in pulling the gear.
Bitcoin has broken a key resistance level
Bitcoin has seen quite a few ups and downs in its evolution and some of them have been the worst ever peaks that could have happened. One of them was in 2019, when bitcoin was just aiming at a value of $14,000, it failed to push through this stage and unfortunately went down to a market price of $3,200. But in December, it achieved an all-time highest value of $20,000. This comeback has provided a sense of trust-worthiness in the minds of the investors.
The recent case filing by the US Securities and Exchange Commission against XRP for violation of security laws has led to a huge crash in the stocks of ripple. Bitcoin, meanwhile, remained largely unaffected. If anything, investments started to pour into bitcoin increasing its value drastically.
Increase in Institutional investors
Developed countries such as Japan, USA and Europe have come to an agreement of monetary easing to build the world economy, which was affected by the present COVID-19 situation. Due to this the value of many currencies has sky-rocketed and the focus has now shifted to assets whose value would never decrease. Some of these alternatives were gold, platinum, oil and digital assets. Now, crypto-currencies were focused on as alternatives as assets and many investing institutions made their way in buying the volume of Bitcoin. Some instances include, the Sky Bridge Capital owning 19 million yen worth Bitcoin and the company MicroStrategy also investing in Bitcoin.
Zero resistance line
Since Bitcoin has managed to pull up its shares past $20,000, there is no resistance line for the firm on the account of having the higher market price and advantage. Due to this it is very technically sound and popular and also trust-worthy for its investors.
Increased adoption Bitcoin as a mode of payment
Recently PayPal has accepted to adopt Bitcoin as one of its payment modes. It nearly has 350 million active users who could use Bitcoin as a mode of payment. They also have 20 million users who could accept the Bitcoin. This has led in the sudden increase of the market value of Bitcoin because of its increasing need and popularity. Also other competitors such as Square and CashApp have been promoting crypto as a mode of payment.
Bitcoin has seen an annual rise of 304%, bigger than any other crypto firm and it continues presently with a rise of 2.23% today. Until September it shared 50 % of the total market value but has suddenly risen to 71.3% at the end of 2020. Even though it is very popular among the market, it still faces some major threats due to its increased users and demands.
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