Barry Silbert, Founder and CEO of Digital Currency Group, recently spoke about the rise of Bitcoin [BTC], during an interview with Yahoo Finance. The CEO also spoke about the things that changed over the past year and whether the cryptocurrency space would see multiple winners or if one coin will rule them all.
On the reason behind the hike, Silbert stated that the current market sentiment and technicals were “great”. He added that an 80 percent drop in value had happened earlier and that every time this happened, it was followed by the coin hitting record highs. Silbert also stated that there was a difference between the 2017 price rise and the current rise, which includes custodians, trading software, and compliance software. He further stated, “people are educated about the asset class. So, it’s different”.
The CEO also pointed out that in Q1 2019, 90 percent of the firm’s money was from institutional investors, adding that 90 percent of that went into their Bitcoin fund. He went on to state,
“Grayscale Investors […] the manager of Bitcoin trust, which is raised publicly simple GBTC […] We have 10 funds, so where the demand is coming from, its institutions now and its right now just Bitcoin.”
“I think what 2018 had was the unwinding of the ICO markets. You had all of the demand for ICOs one way and the projects that raised all the Bitcoin were trying to stay in business by selling the Bitcoins.”
This was followed by Silbert talking about whether Bitcoin would be the sole winner of the cryptocurrency space or whether there would be other coins as well. He stated that there would be a handful of winners based on a particular use-case, citing the example of Bitcoin for digital gold, ZCash, and Horizen for privacy, and Ethereum Classic for smart contracts.
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Bitcoin’s 2017 bull run was fueled by FOMO & hype; present run more fundamentally driven, claims report
Here we go again. Another bull run. Another “hype session” among investors as Bitcoin rises again. The cryptocurrency market is well known for its incredible shift in market sentiment, especially on the back of the world’s largest cryptocurrency surging again.
Bitcoin not only reached its 16-month high today, but it also recorded a growth of 15 percent over the week. This has contributed to several analysts and industry insiders speculating how high Bitcoin will go, with Anthony Pompliano claiming that the digital currency will soon cross its all-time-high valuation of nearly $20,000 and reach a massive $100,000 by 2021.
These predictions have definitely contributed to the coin’s growth as while the present surge is similar to the 2017 rally, it’s not driven by FOMO alone.
A recent comparison drawn out by the SFOX Volatility report compared the preset rally with the bull run of 2017.
The report suggested that the rally of 2017 was largely driven by ‘FOMO.’ When Bitcoin started climbing the valuation ladder, word got out and many investors discovered virtual assets for the first time. The rally of 2017 was mainly fostered through hype and speculation, since there were no major readings or past data to back the rising price.
The present run, while similar, is different in some aspects, one of them being that Bitcoin has a larger user base now than in 2017. While FOMO remains a major factor in driving the price up, the current surge is also backed by developments in the ecosystem, such as the entry of retail investors and huge financial/non-financial institutions joining the crypto-bandwagon.
Facebook’s crypto project, Libra, and Bitmain’s pursuit for a U.S IPO have validated Bitcoin and the rest of the cryptocurrency market, a luxury not available to the market of 2017. The present rally thus, is more mature than the 2017 rally as the present market’s fundamentals are more data-driven.
There remain some stark similarities in the trends however. For instance, in 2017, the push from $9000 to $11000 took place in a period of 7 days. The current push from around $8800 to $11000 came to be in 8 days.
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