After approaching $20,000 in 2017, the price of Bitcoin finally rose above this threshold at the end of 2020.
The price of Bitcoin has risen more than twice this year, but unlike the previous surges, the current round of Bitcoin’s rise lasted longer-24 days ago, Bitcoin once again had three years It hit a record high and then continued to climb, reaching a high of $24,273 last Sunday.
On Wednesday, Bitcoin closed at $23,299. In the past week, Bitcoin has basically started to consolidate the market between 23,000-24,000 US dollars.
Prior to this, Bitcoin had only closed above $19,000 in the past and only three times closed above $18,000.
In contrast to the current gains, in the last round, after 24 days of setting a record, Bitcoin fell by 29%, a drop of 38% at one time. 31 days after reaching the peak, the price of Bitcoin is already less than $10,000, and the high point has fallen by nearly 50%. For the next two years, Bitcoin has been languishing.
Undoubtedly, judging from the factors driving the rise of Bitcoin and the trend of a period of time after the price hit a new high, the market has undergone tremendous changes in the past three years.
☆The uptrend is more reliable
Bitcoin bulls claim that compared to the past few big gains, the source of funds to promote Bitcoin’s rise this year is more reliable. Data from the analysis company Chainalysis shows that since September, new large investors have purchased a total of about 500,000 bitcoins, worth about $11.5 billion. Chainalysis tracks the holdings of investors who have at least 1,000 bitcoins in their wallets for less than a year.
This year, well-known bitcoin buyers include billionaire investors Paul Tudor Jones and Stanley Druckenmiller, as well as Square Inc. (SQ), Microstrategy Inc. (MSTR), MassMutual Life Insurance Co. (Massachusetts Mutual Life Insurance Co.), etc. the company.
Small and medium buyers have also increased. According to data from Chainalysis, since the beginning of this year, there have been more than 38 million Bitcoin transactions with a single amount of less than US$1,000 transferred into personal wallets, nearly double the 20 million in 2017.
Pascal Gauthier, CEO of cryptocurrency hardware maker Ledger, said: “This bull market feels very different.” He said: “2017 was a crazy bull market dominated by retail investors. This time it’s true. “
In this regard, Bitcoin supporters hope that the industry has developed enough to handle its newly discovered wealth. This cryptocurrency was originally designed as a digital version of cash, not controlled by the government or banks. Its software runs on mutually connected but independent computer networks. Anyone can download and run the program and become a part of the network, but no party has the right to unilaterally change it.
For those who want to quickly and cost-effectively transfer funds across borders, prevent assets from being regulated by the government, or simply hold an asset that is not bound by the value of the dollar, this decentralized structure makes Bitcoin a one An attractive asset.
The rise of Bitcoin has also triggered repression from regulatory authorities, which has suppressed investor enthusiasm. For example, in 2017, the US Securities and Exchange Commission (SEC) cracked down on initial coin offerings (ICOs). Bitcoin’s rally that year was partly due to investors’ enthusiasm for ICOs. In such transactions, start-ups and issuance projects raise funds by creating and selling their own digital currency. Before that wave of investment boom ended, ICO activities raised more than US$4 billion in 2017. Most projects are poorly conceived, poorly designed, or outright fraud. Regulators cracked down. Only a few currencies survived.
This year, the regulatory level has clearer regulations for cryptocurrencies. Institutions such as the SEC and the Internal Revenue Service (Internal Revenue Service) have established standardized rules for cryptocurrencies.
Of course, although there have been many increasingly bold predictions surrounding the price of Bitcoin, savvy industry insiders are also wary of the huge rises and falls of Bitcoin from time to time, and said that the well-known volatility of Bitcoin has not disappeared. After the Bitcoin price hit a high on December 1, it fell as much as 12% before rebounding.
Mati Greenspan, founder of the research firm Quantum Economics, said: “We have not yet entered a bull market cycle. From this point of view, we obviously don’t think there will be a bear market.”
