Bitcoin, despite sell-offs over the weekend, has regained its value and has soared past the $8,000 USD mark today. Over the weekend, because of massive sell-offs in the market, Bitcoin lost 3% of its value over the course of Sunday, however since the beginning of this week, Bitcoin is back and after having gained almost 4%, is steady at $8,000 USD.
Bitcoin price Vs USD
Bitcoin enthusiast groups and the cryptocurrency community is abuzz with excitement, because Bitcoin has the tendency to influence other coins as well. So, when Bitcoin does well, every other coin in the market does too, riding its coattails.
As is clear from the graph, the rise started only at 9:00 AM UTC today. With Bitcoin slowly fluctuating between $7,500 USD and $7,800 USD until almost two hours later at around 1:00 PM UTC, Bitcoin hit $8,000 USD.
Reasons Why
The current rise that Bitcoin is seeing in its value can be because of a whole plethora of reasons. There is no one reason and there are no group of reasons that are the obvious explanation for this.
However, the reasons that seem most likely as of now are the following;
Institutional Investments
Since its bull in December, Bitcoin has caught the attention of many investment firms, skeptics and for good reason, regulators. The last couple of months in the cryptocurrency market has been definitive with a lot of regulation coming the market and the industry’s way.
Only recently the Chicago Board Options Exchange filed for an ETF (Exchange-Traded Fund) license in order to list Bitcoin on their exchange, then there is also a court case that is being heard in the Supreme Court of India between the industry and the Reserve Bank of India’s imposition of a blanket ban which is seemingly going the industry’s way, etc.
With more and more regulation across countries and continents, institutional investors are becoming more comfortable with investing in the cryptocurrency market. This could a very large contributing factor to the sudden rise in value that Bitcoin is experiencing.
Tax Season
With the third quarter of the year beginning, the world is failing to pay their taxes and with most countries having no regulation on digital assets, Bitcoin and other altcoins are non-taxable under existing law frameworks.
This could be one of the reasons for the price hike the Bitcoin market is currently facing.
Regulatory Support
Initially, when the cryptocurrency market was being discussed, a lot of times it was mixed with stories of scams, fraudulent ICOs, etc. But with more and more research and with general knowledge about the industry and market on the rise, the shadow of fraudulent ICOs and schemes have lifted from the cryptocurrency market.
People no longer confuse the two and many regulatory bodies have allowed and legalized the existence of the market and day-to-day trading in the market but have advised people against investing in ICOs.
The Ad-Ban Reversal
In the beginning of the year, the cryptocurrency market was delivered three severe blows one after the other. With three internet giants; Facebook, Google and Twitter, banning any cryptocurrency related advertising because they said that a large majority of the advertisements they were running were fraudulent and a mean to scam people. To instate this ‘ad-ban’, all three companies amended their advertising policies.
A couple of months on, Facebook has reversed its ban by once again changing its advertising policy, allowing advertisements of cryptocurrencies and the market, but has stood steadfast against ICO advertisements. Recently, Reddit was abuzz with the news of Google, also, making a similar move by allowing Coinbase to reactivate their Bitcoin advertisement. However, there has been no official statement made by Google yet.
The withdrawal of advertising support from these internet giants came as a huge blow to the market because it reflected on the legitimacy of the market. But with it being restored by Facebook, Google and Twitter are soon expected to follow and Facebook’s policy change could be one of the driving forces behind Bitcoin’s current rise.
Serendipity?
Last year, Bitcoin saw its first market bull. With prices shooting up to $20,000 USD on the 17th of December. Though the price did not go further than that, it was the first time that the market had ever seen such a large scale bull.
The price from then on fell rather drastically over the next two months and slumped down to a value of $6,252 by the 6th of February, 2018.
The market bull in many ways, caught the attention of a lot of skeptics and governments. Bitcoin and altcoins had arrived and were the main matter of discussion because it had made such significant gains at rates that have never been seen before.
With the market flooded with new money and a new found loyalty, big names like Soros, Rockefeller, etc entered the market around the time. And many key players in the industry, among which are names like John McAfee, Craig Wright and more recently Marc Lasry, predicted another bull over the course of this year.
Though most people shrugged it off as sheer optimism at the time, with Bitcoin rising now, it seems to have most of the tells of a trend that is on the upslope and the July trends of Bitcoin this year are a dead-ringer for July last year’s trends. The price of Bitcoin, before it peaked at $20,000 USD on the 17th of December, started to rise slowly, but steadily too from July, 2017.
The next couple of months are going to be interesting because the market is either in for a large fall or is in the making of the next Bitcoin Bull. People are optimistic that this might be the beginning of the next bull and predictions as to what the highest price will be this year, are making the rounds on the internet.