Bitcoin [BTC], the world’s largest cryptocurrency, has seen a radical shift in its perspective ever since its value growth over the past one month. The cryptocurrency witnessed a massive 100 percent increase in its price which enabled it to break the $8,000 threshold and almost double user investments overnight. Many proponents of the cryptocurrency have also bet on Bitcoin to outperform traditional S&P stocks, deeming it to be more than just a 10-year-old speculative asset.
Recent surveys showed that on May 23, Bitcoin prices climbed higher than what it was exactly a year back, a phenomenon which has not happened in a 200-day period. Looking at the growth history of Bitcoin, it was also seen that the ‘king coin’ traded higher year-over-year 75 percent of the time, a fact that supporters of the coin were pointing at to make the case for its longevity. Looking at its price charts, Bitcoin closed at $7,556 on May 23, 2018, and the mark was broken a year later when the cryptocurrency closed at $7,875 on May 23, 2019.
The aforementioned 200-day window was important because the start of it signaled the start of the crushing bear market which wiped almost 80 percent of the cryptocurrency market’s valuation. The price hike has been on the back of several updates and developments which have been taking place in the Bitcoin ecosystem, which in turn has affected the rest of the market as well.
At the time of writing, Bitcoin was trading for $7,907.27, with a total market cap of $140.11 billion. Over the past week, the cryptocurrency further witnessed an increase of 7.34%, which also corresponded to an increase in its 24-market volume which stood at $23.36 billion.
Another important area of discussion in the Bitcoin-sphere was related to its futures contracts, a topic that was discussed recently by ErisX CEO Tom Chippas. He had claimed that Bitcoin Futures were still subject to final licensing requirements from the CFTC.
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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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