Why Bitcoin Prices Have Risen More Than 400% This Year - Forbes
Bitcoin prices have risen more than 400% this year, creating strong visibility for cryptocurrencies. Shutterstock
Bitcoin prices have climbed more than 400% this year, providing investors with robust gains and generating strong visibility for the broader cryptocurrency space.
Bitcoin, the world’s largest digital currency by market capitalization (market cap), reached to as much as $4,935.05 today, according to CoinDesk’s Bitcoin Price Index (BPI). Since Bitcoin started the year at $968.23, this latest high represented a roughly 410% year-to-date (YTD) increase.
The cryptocurrency’s market cap has also risen quite a bit this year, surpassing $80 billion at the time of report, additional BPI figures show.
[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
Sustained Strength
The price of Bitcoin has consistently traded at elevated levels in recent months, fluctuating close to $4,000 for a few weeks in August, additional BPI figures show.
This presents a contrast to earlier this year, when the cryptocurrency reached an all-time high in March and then plunged shortly after the SEC announced its rejection a Bitcoin exchange-traded fund proposed by the Winklevoss twins.
That day, Bitcoin’s price fell nearly 30% following the decision, according to CoinDesk.
Growing Interest In Crypto
As for what has caused Bitcoin’s sharp rally this year, analysts cited several key factors, including rising interest in cryptocurrencies.
There is “no question” that these digital assets are experiencing growing interest, especially on the part of finance professionals and funds, stated cryptocurrency fund manager Jacob Eliosoff.
Aside from this rising industry acceptance, digital currencies are benefiting from other trends, according to Sean Walsh, partner at Redwood City Ventures.
More and more people are coming to recognize that this asset class is particularly attractive during times of political turmoil, he said.
Media Coverage
Another notable trend is the fact that these innovative assets have been receiving more coverage from mainstream media outlets, a development that illustrates their growing adoption.
This broader news coverage has helped spur greater interest, said Charles Hayter, co-founder and CEO of digital currency platform CryptoCompare.
Iqbal Gandham, UK Managing Director at eToro, a multi-asset broker and social network trading company, offered similar sentiment, stating that “The sheer volume of news has increased.”
Sustained Inflows
Further evidence of this strong interest can be found in the inflows that the broader cryptocurrency space continues to attract.
The total market cap of all digital currencies has risen sharply this year, hitting a fresh, all-time high of more than $178 billion today, according to CoinMarketCap.
After climbing to this level, the cryptocurrency’s total market cap has risen more than 900% YTD.
ICO Frenzy
Another development that illustrates the enthusiasm that investors have for these digital assets is all the initial coin offerings (ICOs) that have been taking place.
These innovative token sales have raised more than $1 billion this year, according to figures provided by PitchBook and reported on by Fortune on July 28.
At the time of report, ICOs had raised six times as much money in 2017 as they did during all of 2016.
The rising incidence of these token sales has pushed many investors to Bitcoin, said Hayter. He asserted that Bitcoin represents a flight to safety for some market participants.
Bitcoin is both the largest cryptocurrency by market cap and also the first to scale, which helps support his assessment.
Segregated Witness
Another factor that has helped push Bitcoin prices higher is the community’s decision to implement Segregated Witness (SegWit), an upgrade that increased transaction capacity, said analysts.
SegWit has made it so Bitcoin’s blocks can hold more transactions by reducing their size.
This has helped “release pressure” on the network, Hayter asserted.
It has also provide tailwinds for Bitcoin’s price, said Walsh.
He stated that ”Tangible progress in the scaling debate,” including the implementation of SegWit, has helped “anxiety of big market participants.”
Significant Progress
Bitcoin has made significant progress this year, reaching several milestones and enjoying the resulting price increases.
Arthur Hayes, co-founder and CEO of leveraged cryptocurrency trading platform BitMEX, summed it up nicely:
In 2017 Bitcoin overcame many obstacles in the minds of investors. [SegWit] was activated, which in theory solves the scaling issue. Institutional capital is beginning to gravitate towards crypto through capital deployed by small hedge funds. And most importantly, the mainstream financial press [now] acknowledges that digital currencies are here to stay.
MY OTHER POSTS ABOUT BITCOINS ARE:
https://steemit.com/cryptocurrancy/@funandmoney/how-to-identify-a-scam-in-the-crypto-world
MY OTHER POSTS ABOUT BITCOINS ARE:
https://steemit.com/cryptocurrancy/@funandmoney/how-to-identify-a-scam-in-the-crypto-world
MY OTHER POSTS ABOUT BITCOINS ARE:
https://steemit.com/cryptocurrancy/@funandmoney/how-to-identify-a-scam-in-the-crypto-world