In May 2019, the value of bitcoin crossed the $8000 mark and this is not the limit
The increased excitement around cryptocurrencies is caused by the high popularity of bitcoin. It is recognized by many as a full-fledged settlement means.
For the first time since the summer of last year, the price of bitcoin exceeded us $8 000. As of May 9, it has crossed the $6,000 mark, may 12 has risen above $7,000, and may 14 was trading at $8199. As of 30 May 2019, the average coin value is $8,736, and some experts believe that its growth will not stop at this point.
However, such bitcoin activity and positive dynamics of the exchange rate were not always observed, there were times when this cryptocurrency was in decline.
In January 2016, the crypto-currency community was stunned by Mike Hearn’s statement that he was no longer going to participate in the elaboration of the Bitcoin, as this cryptocurrency had failed, informed BBC.
A significant price collapse occurred in the cryptocurrency market last year. The value of bitcoin reached its lowest level since October 2017 and lost almost $20 billion of market value. In a very short period, Bitcoin fell by 15%. The Bitcoin exchange rate updated at least one after the other: first year, then got to stamp the autumn of 2017. As a result, the quotes fell to $4.5 thousand per unit of cryptocurrency. In two days, it lost almost 20% of its market capitalization — from $97.2 billion it fell to $78.1 billion.
At that time, experts said that the bitcoin exchange rate will rise slightly after the fall, but on the eve of the financial crisis, it is not worth investing in the cryptocurrency. The world community was waiting for the financial one and it was suggested that the cryptocurrency as the most vulnerable segment of assets could show the greatest decline.
Bitcoin development at the present stage
After the crisis of Bitcoin and the fall of its value, interest in this market has almost disappeared, but the value of the digital asset has gradually risen. And now the moment has come when the cryptocurrency market is experiencing a new wave of rising. For one bitcoin now give more than $8 thousand in Just a week, the price increased by a third.
The cryptocurrency market is very opaque. Users can not predict in advance who and when to buy, how and why. But one thing is clear: this market can also be manipulated, and some major players are clearly using it.
Blockchain technology, from which bitcoin has grown, is gradually entering our lives. It is increasingly used for various purposes, but cryptocurrencies themselves are not particularly used, except for some transactions between individuals or for illegal transactions.
The unexpected increase in bitcoin’s value during May diverts attention away from the fact that people have actually stopped using it as a means of payment. Statistics say that the percentage of purchases paid with bitcoin from the total volume of financial transactions was only 1.3. And so we can conclude that during the boom and recession of the last two years, the situation remained the same.
Reasons for bitcoin growth
Since may this year, there has been an increase in the value of bitcoin. In just a few days, it grew by a third. Experts attribute this phenomenon to a number of reasons:
- Since 2019, some investors, including quite large ones, have decided to adhere to the funded strategy, the essence of which is to retain the digital currency, making purchases more often than their sales. And everyone knows the fact that the exchange rate of the cryptocurrency depends only on demand, which is why the cost of bitcoin jumped.
- Buyers and holders of cryptocurrencies recognized the great profitability of bitcoin. In this regard, increased sales of altcoins, such as Zcash and buying of bitcoins.
- The situation around the trade war between the United States and China. On may 10 this year, the United States of America increased the amount of duties by 15%, this affected almost all goods supplied from China, reports CNN. This created favorable conditions for increasing operations in the shadow market: smugglers in an attempt to avoid paying high fees make transactions using cryptocurrencies. It is worth noting that cryptocurrencies are widespread in Asia, including China. The sharp increase in the value of bitcoin two years ago was due to the arrival of Asian investors in the cryptocurrency market.
Expert opinions on the value of Bitcoin in the future
When forecasting investment projects for a period of four or more years, the Sharpe ratio of bitcoin is still higher than:
- real estate;
- bonds, gold;
- emerging market currencies;
In other words, bitcoin is still the most profitable asset for long-term investment.
However, if we talk about medium-term forecasts, we cannot say anything concrete. Some cryptanalysts express their opinion about the decline in the value of bitcoin, and predict its fall this summer to the level of 2000 dollars.
Since the crypto-currency market and bitcoin in particular are ambiguous in themselves, the opinions of experts about its development are different. For example, analyst Renato Shirakashi has the opinion that the cryptocurrency market is already on the verge of falling. At the same time, he does not deny that the price can hold within $3-5 thousand dollars for Bitcoin for some time.
Tom Lee, a well – known analyst and co-founder of Fundstrat Global Advisors, also expressed his opinion about the bitcoin exchange rate. He believes that by 2020, bitcoin could reach a level of 25 thousand dollars.
If you believe the forecasts of the Creator of the famous company Crypto Solutions Petros Anagnost, then after 2020, the bitcoin rate will vary from 50 to 100 thousand dollars per coin.
Coinspeaker website editor Daniel Harrison made his prediction about the price of Bitcoin, which in 2020 will reach $30 thousand. He also said that, in his opinion, the price of bitcoin consists of the following components:
- investment value;
- issue value;
- vuse value.
It will have an impact on the increase in the value of the cryptocurrency.