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Bitcoin ushered in a new wave of price increases.
On the evening of December 26, the price of Bitcoin broke through 24,000 U.S. dollars, and then quickly broke through 25,000 U.S. dollars, 26,000 U.S. dollars, and nearly reached 27,000 U.S. dollars. According to the price of Coindesk, the Bitcoin news information network, the highest Bitcoin price reached US$26,913.33. As of press time, the price of Bitcoin is about US$26,589, an increase of 7.11% within 24 hours, and the transaction volume of Bitcoin within 24 hours is US$43.07 billion.
As of press time, the market value of Bitcoin is about 494.08 billion U.S. dollars, once more than 5,000 U.S. dollars, close to the total market value of JP Morgan Chase and Citibank. As of now, the market value of JP Morgan Chase is about 379.6 billion U.S. dollars, and the market value of Citigroup is about 126.1 billion U.S. dollars.
In addition, according to the contract statistics report, in the past 1 hour, the entire Bitcoin network has been liquidated by a total of 3.25 million US dollars, and the entire Bitcoin network has been liquidated by 306 million US dollars in 24 hours, with 17,351 people liquidating.
On the evening of December 16th, Bitcoin stood at $20,000 in one fell swoop, and rose by more than $3,000 in one day. After a few days of sideways trading at $23,000, it once again ushered in a rise, constantly refreshing historical records.
Daisy, a senior analyst at Huobi Research Institute, said that after a week of turbulence, Bitcoin has once again gained momentum and made history again.
He believes that this round of rise may have the following two driving factors:
The first is the resurgence of the British epidemic. Six days ago, a new mutated, faster-spreading coronavirus strain was discovered in the UK, leading to a rapid increase in the current rate of new crown pneumonia infections in London and the southeast of the UK. The UK had to implement a more stringent fourth Level blockade restriction policy. The further deterioration of the epidemic has intensified expectations of global economic recession, and global inflation has become an unstoppable trend. In addition, deflationary assets with anti-inflation properties are originally scarce resources, so the demand for Bitcoin has further increased.
The second is the further expectation of Bitcoin compliant products. Digital Currency Group (DCG), the parent company of Grayscale Investments, plans to launch a new wealth management subsidiary, which will join Grayscale, and may subsequently bring more compliant products to the market. This wave of market is that many new investors have participated in the market. Institutional users have clearly entered the market. Compliant gray trusts continue to increase their holdings. Many licensed investment institutions have established digital currency funds or applied to regulatory agencies to trade digital currencies. , And listed companies allocate Bitcoin assets. These are unprecedented.
William, the chief researcher of OKEx Research, also believes that speculation and hype do exist, but they are not the main reason for Bitcoin’s current rise. The direct reason comes from the entry of high net worth and institutional investors, and the underlying reason behind it is the changes in the global macroeconomic situation this year. On the one hand, due to the impact of the epidemic, the recovery of the global economy will slow down in the next year; on the other hand, the central bank’s extremely loose monetary policy has pushed up inflation expectations in financial markets. In an economic environment of high inflation and low growth, in order to avoid the loss of nominal principal and the need to pursue higher returns, investors’ demand for hoarding cash has naturally evolved into a demand for gold and bitcoin.
He said that from the current market situation, Bitcoin is gradually changing its positioning from “alternative investment products” to “digital gold”. It can be said that this round of Bitcoin bull market is a product of high inflation expectations. For institutional investors, what they care about is profit, not feelings like “Bitcoin faith” or “Blockchain revolution.” After the vaccine is on the market and the epidemic is gradually alleviated, with the gradual recovery of the economy, monetary policy will gradually change from loose to moderately tight. At that time, institutional investors may sell Bitcoin.
“Prior to this, Bitcoin will continue to maintain a major upward trend. Of course, as the price of Bitcoin gets higher and higher, market fluctuations will gradually increase. Investors are not recommended to increase leverage.” William said.