New price adjustments for volatile Bitcoin (BTC) may spark your thoughts on crash photos in 2017, or even the crashes caused by COVID-19 in March. But the fact that Bitcoin reached $ 20,000 for the first time in history is not a cause for concern.
Even though the price of the world’s most valuable cryptocurrency has risen by more than 225% this year, the current bullish growth we’re not seeing resembles the bitcoin craze we experienced in 2017. There are four main reasons for this:
Investing in institutional space at the highest level.
This time, the regular media attention has nothing to do with catapult prices.
Central banks and governments are starting to see the writing on the wall.
Retail investors in emerging markets are investing in what they hope will revolutionize.
These four reasons are not only relevant now; They will all continue to play a role in Bitcoin’s future growth. Rate this as your news. Bitcoin is no longer in a bubble, and the traditional economic world is quickly the only one on the verge of bursting.
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Institutional investment in Bitcoin will rise in 2020
Bitcoin is no longer just for the tech-savvy young millennial. Governments, central banks, and large corporations can no longer ignore value. This is why the headlines have attracted more premium investment from major Bitcoin backers in 2020.
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General business advisory firm MicroStrategy now has 38,250 Bitcoins worth just under $ 640 million. BTC was originally acquired for about $ 250 million earlier this year. The sheer scale of the purchase and its profitability made CEO Michael Sellor a true preacher for bitcoin. Aside from large mutual funds, no bitcoin company owns more than MicroStrategy.
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Sailor and his company were joined by Square CEO Jack Dorsey in their enthusiasm for bitcoin. Dorsey bought about $ 50 million in cryptocurrency for his company. Even more important than this $ 50 million investment, however, is that both Square and the payment competitor PayPal estimate that they have absorbed more than 70% of the newly recovered bitcoins in circulation. Square allows customers to use cryptocurrency as a method of payment; PayPal allows buyers and sellers to purchase Bitcoins directly from their PayPal accounts. Both portals are currently generating huge market capitalization gains for Bitcoin.
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Retail investors no longer follow trends in the mainstream media.
In 2017, it would be difficult for you not to hear about Bitcoin. Whether a friend or family member spoke to you about it at Christmas, or heard about it in the news or in TV ads, nearly all of the major media outlets covered the price increase at the time.
Fast forward to these days, and you can take a look at Google Trends to see that Bitcoin searches have been high lately, but aside from investing TV shows, you don’t hear about Bitcoin in the mainstream media nearly as much. Same thing, with some exceptions of course.
This means that we have reached a new stage of adoption. More and more people are aware of cryptocurrencies than ever before, and they are now monitoring the asset class more closely.
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Central banks and governments have no choice but to join the party
Russia, China, Canada, the European Union and many other countries are already working on central bank digital currencies, or publishing official documents describing their intentions. Moving away from paper money and plastic credit cards is the next natural step for the world as payment technologies continue to advance. But as crypto enthusiasts know, a blockchain-based digital currency owned by a central bank or government is not the same as a currency built on decentralized technology.
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This is clearly a sign that those in power in the ancient economic world are seeing the writing on the wall. They do everything to protect a system that is beneficial to those in power. But CBDC and stricter government regulations will only blur the lines between sponsored digital currencies and Bitcoin. It is only a matter of time before the community chooses the latter over the former.