Following a market-wide rally, Bitcoin returned above $50,000 this week for the first time since early September.
On Wednesday, the cryptocurrency surpassed $55,000, with the most recent price rises coming after bitcoin temporarily dipped below $30,000 at the end of July. Bitcoin is now only $10,000 away from reaching an all-time high in mid-April.
Other major cryptocurrencies have followed bitcoin’s lead in recent weeks, with Ethereum (ether), Binance Coin, and dogecoin all increasing by 15-30% since this time last week.
The overall crypto market is now worth nearly $2.2 trillion, up more than 15% since the beginning of October.
Following a weak September, several analysts forecast a strong conclusion to 2021. One price prediction model, which was very accurate in August and September, predicts that bitcoin will reach six figures before Christmas, albeit there are some caveats.
What caused today’s bitcoin price surge – and what comes next?
Because Bitcoin’s price movements are notoriously volatile, it can be difficult to attribute any single rise or drop to a single event. There are usually multiple factors at work, which can snowball into other forces that either push it further along its trajectory or cause it to rebound in the opposite direction.
We’ve heard from a number of market experts and cryptocurrency analysts, all of whom are attempting to make sense of the recent price surge. The reasons range from Facebook’s mass outage to the pandemic’s influence. They also speculate on where bitcoin might go from here:
With interest rates rising and global markets in turmoil, current economic conditions exemplify why bitcoin was created. Bitcoin is becoming increasingly resilient in the face of market turbulence and impending regulatory scrutiny.
The latest outage on Instagram and Facebook also revealed the world’s disastrous reliance on centralized systems, proving the famous saying that ‘bitcoin never goes down.’
Our reliance on faulty frameworks underpinning financial and technological systems – whether it’s government money or traditional social networks – means that the fallibility of these systems will have increasingly dire consequences, underscoring the essence of why bitcoin, a fundamentally transparent, censorship-resistant, and immutable currency, is unique – and how bitcoin adoption can transform our world.
In previous cycles, we’ve seen bitcoin perform spectacularly in Q4. I’m hoping for another strong showing.
Matt Senter, Co-Founder, and CTO of Lolli, a bitcoin rewards app
Bitcoin’s crossing of the $55,000 barrier today reflects a rising realization that the world’s largest cryptocurrency is the solution as the velocity of money continues to fall while the astronomical levels of debt continue to rise. Of course, whether or not there will be a stock or property crisis in the near future is speculative. What is certain is that money printing has had little effect on the real economy. Rather, it has contributed to the wealthiest becoming richer while the poor and middle classes have been poorer.
Meanwhile, digital assets are still in their early phases of development, with bitcoin only recently gaining greater acceptance as a type of digital gold. Millennials and younger generations intuitively recognize the value of investing in bitcoin and cryptocurrencies. Implicit in this is an acknowledgment that these digital assets have the potential to fight harsh societal disparities that have only been exacerbated by the pandemic.
Bitcoin price gains top 10 percent in 24 hours
Bitcoin has risen by 10% in the last 24 hours. When viewed in context, even such a big price increase appears rather minor.
Looking back even further, here’s how the cryptocurrency’s price has changed:
10% increase in one day
+30% in one week
+414 percent after one year
+8,770% after 5 years
+2,749,900% in ten years
Could Brazil be next to embrace bitcoin?
People are asking who will be the next government to adopt bitcoin as legal cash after El Salvador became the first in the world to do so.
If recent rumblings south of the equator are to be taken seriously, Brazil, the world’s 12th largest economy, could be the next to take the leap.
This week, a cryptocurrency regulatory measure is set to be introduced to the Plenary of the Chamber of Deputies, which, if passed, will allow Brazilians to use bitcoin to buy everything from houses to groceries.
The Bitfinex cryptocurrency exchange’s chief technology officer, Paolo Ardoino, has told us how significant such a move would be.
“The likelihood of Brazil adopting bitcoin as legal cash would be a watershed moment in adoption,” he said.
“There will continue to be challenging in developing an infrastructure that operates quickly and efficiently.” Allowing speedier transactions among participating nodes becomes a big pain point as payment networks get larger – in the case of Brazil, this would be a country with a population of over 200 million people.
The majority of bitcoin’s day-to-day use will necessitate the deployment of a second layer technology, such as the Lightning Network, as a solution to the scalability problem.”
Bitcoin price on the charge once again
Bitcoin is seeing another price surge, surpassing $55,000 for the first time since May. It is now less than $10,000 from its all-time high, which it reached in mid-April.
The price increase has pushed its market worth past $1 trillion, providing a significant boost to the whole crypto market.
Ethereum (ether) is currently back above $3,500, while dogecoin is now closer to $0.30 than $0.20, after languishing below $0.25 for several weeks. Every single one of the top ten most valued cryptocurrencies is currently in the green on both a 24-hour and a seven-day basis.
Bitcoin price to see ‘very significant moves to the upside’
The supply of bitcoin owned by long-term holders is an important statistic for estimating price changes.
Of the 18.78 million bitcoins now in circulation, 13 million – or 69% – are held by persons who have had them for 12 months or longer.
“Tracking this metric is important as it clearly highlights times of tight supply, which are often highly correlated with significant future price appreciation,” Will Hamilton, head of trading and research at digital asset management firm TCM Capital, told The Independent.
“More and more investors are buying and holding, which should translate into higher prices. All things considered, we think Q4 will see some very significant moves to the upside for the market as a whole.”
Bitcoin price recovery divides analysts
Is bitcoin’s stunning comeback the second leg of a bull run, or merely a “dead cat bounce” before collapsing again?
This is the question that is currently splitting crypto market analysts, with supporters of the first theory expecting bitcoin will reach new all-time highs in the coming months. Those who are most bullish believe bitcoin will reach six digits before Christmas.
One researcher has drawn parallels to similar market patterns experienced in 2017 when the price of bitcoin doubled between early October and December.
According to the two opposing views, bitcoin will be worth a fraction of what it is now by 2022, or several multiples of what it is now.
If bitcoin rises another $14,000 in the following weeks, the dead cat bounce idea will be proven false. However, it must fall well below $30,000 before the price rally argument can be rejected.
Bitcoin price holds firm above $50k
According to CoinMarketCap’s price index, the price of bitcoin has managed to stay over $50,000, hitting as high as $51,839 on Wednesday morning.
It’s currently up more than 20% week over week, and bitcoin’s market valuation is steadily approaching $1 trillion. It was above this location the previous time it was seen in May.
Although Bitcoin’s revival has supported the likes of Ethereum (ether) and dogecoin, not all of the top cryptocurrencies have seen price increases overnight. Solana (SOL) plummeted roughly 10%, relegating it to second place in terms of overall market cap behind Ripple (XRP).
Bitcoin blasts past Facebook
Bitcoin’s recent price increase has boosted its market capitalization above that of Facebook.
Earlier this year, during its record-breaking price climb, bitcoin momentarily rivaled the market value of silver, while the broader crypto market topped the total worth of Apple, the world’s most valuable firm.
It’s still a long way from gold, which has a market capitalization more than ten times that of bitcoin. Some prominent investors, like Tim Draper, anticipate bitcoin will someday reach these levels, at which point a single bitcoin will be worth more than $500,000.
Bitcoin price back above $50k
After a day of gradually rising prices, bitcoin has finally surpassed $50,000. It is the first time the cryptocurrency has surpassed this level since early September, and it means bitcoin has gained more than 18% since the beginning of October.
We’ve heard from various experts and analysts who share their perspectives on what’s driving the latest price spike and guess on where it might go from here.