- Bitcoin’s impressive price rally sees it reach a new record high of $52,340 on Wednesday, showing no signs of a slump
- Unless volatility starts to ebb, the current price may be unsustainable, JP Morgan warns
- Major corporations like Tesla, Greyscale, Mastercard are all jostling to invest in the largest cryptocurrency by market capitalization
On Wednesday afternoon, Bitcoin reached an all-time high of $52,340 and went on to even surpass it and reach previously unreached frontiers. The cryptocurrency reached $52,340 from data gleaned from the popular Coin Metrics.
Since the start of 2021, bitcoins price has risen steadily and analysts at Wall Street have placed the coin firmly in a bullish trend. The bullish trend shows no signs of slowing down, having gained 70% of its value from the early months of 2021.
Reason For Bitcoin’s Impressive Run of Form
Several factors may account for Bitcoin’s impressive price rally in 2021. First of all, the increase in popularity of Bitcoin is unmatched by any other altcoin as it is now more mainstream than ever before.
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Bitcoin ATM has sprung up in major cities around the world and several businesses now accept Bitcoin as a valid means of payment. This global acceptability and institutional interest has made Bitcoin’s value soar even higher
Secondly, the influx of huge corporations and hedge funds in the cryptocurrency industry has seen the market capitalization and volume reach unprecedented levels. Chief amongst these institutions is Tesla whose CEO, Elon Musk cryptic tweets have set off positive price action in the market.
A couple of weeks ago, the automobile manufacturer decided to make a heavy purchase of $1.5 billion worth of Bitcoin to diversify his company’s portfolio. A couple of days later Bitcoin’s value went up by over 15%.
On The Flipside
- Bitcoin’s volatility may lead to its abandonment as the leading coin of choice for transactions, warns analysts.
- Following the same trend, Dogecoin’s (DOGE) fall grace continues with prices down by 16.35% in the last 7 days
- The trend began after a major price pump following the GameStop saga
After Tesla’s move, several corporations have indicated a firm interest in investing in Bitcoin and similar Cryptos. Hedgefund magnates Grayscale already owns the largest portfolio of crypto-currencies and is looking to expand on its holdings after purchasing $8 billion worth of Bitcoin in 2014.
Mastercard and Square have unfolded their plans to add crypto-currencies to their network to ease transactions. Similar, Wall Street giants like JP Morgan and Morgan Stanley are keeping a close eye on things with an investment arm of Morgan Stanley reportedly lining up a $150 billion investment on Bitcoin.
Dan Ives, the Managing Director at Wedbush Securities has explained that;
Bitcoin Changing The Financial World As We Know It
Bitcoin is a cryptocurrency invented in 2008 that became operational in 2009. Invented by Satoshi Nakamoto, it is a decentralized digital currency that can be sent from user to user without a third party or a central bank. Transactions are verifiable through Blockchain, a public ledger. Presently, there are 18,355,100 units in circulation and it has a total limit of 21,000,000.
With a market capitalization of $986.07 billion, Bitcoin is the largest cryptocurrency in the world and at a current price of over $52,000, it is set to even soar higher. However, an analyst at JP Morgan noted that unless volatility starts to ebb, the current price may be unsustainable.
