The recent Bitcoin Price Break Out marks the $2000 threshold and is still rising. This weekend Bitcoin made history by surpassing the $2000 for the first time ever. With this fresh new record tucked under its belt, Bitcoin is looking at a very interesting future. Not least of all because of the growing trader interest.
In 2017 the Bitcoin price breakout has signaled a 100% surge in less than six months. As late as March 2017 Bitcoin’s price was at $891.51. It had slumped after the rejection by SEC of the Bitcoin ETF’s proposal by Winklevoss Twins.
Clearly, the rejection did not do much to dampen spirits as the price has been steadily soaring ever since.
If you are wondering how this bitcoin price breakout reaching the milestone $2k is going to affect trading than the answer can be found from a quote by Arthur Hayes. Hayes. Hayes is the co-founder and CEO of BitMex. He is confident that now that he bitcoin price breakout is over $2k, the growth will be exponential and dramatic
“As a psychological level, bitcoin hitting $2,000 is an important milestone and will generate further interest that can boost the price further”
There is no question that this sudden surge in price and the proverbial walking over the 2k threshold, will spark a lot of interest in the media.
The Man in the Street is Still Largely Without Knowledge of Bitcoin
Despite the recent Bitcoin price breakout, and the increased attention that Bitcoin is receiving from the media, there is still very limited knowledge about bitcoin from the public in general.
For example, Google Trends show that searches for the keyword “bitcoin” or “bitcoin vs dollar” is still not as high as it was in 2013. 2013 had marked an all-time high. However, interest waned as many scandals over the payments by bitcoin in the drug-dealing business were exposed.
If the level is equated at 100 in 2013, the level of search today is closing in at 85!
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Bitcoin Price Breakout Marks Growing Interest by Traders
One significant reason for the bitcoin price breakout during the past six months can be directly attributed to growing trader interest. The trading volume recorded by exchanges has significantly increased. We were looking at volumes of 25,000 daily transactions in 2013. The volume has risen all the way of 330,000 daily transactions in 2017. It has been indicated that daily trading volume is now close of $180 million and rising.
Image courtesy of Coindesk
In this statement by Poloniex we can clearly understand how the extent of increased trading interest, is setting to help the bitcoin price breakout.
“We have never seen such enthusiasm from trading blockchain tokens as we have in the past few months. Since January 2017, we have seen an increase of more than 600% active traders online and regularly process 640% transaction than we did merely (four months) ago”
Needless to say, this growing interest is a major factor in contributing the surge in price.
Japan Legalised the CryptoCurrency as a Method of Payment
In a recent article by CNBC it is revealed that Japan has legalized the payment by Bitcoin and other digital currencies as from 1st April. But if that is not enough, Russia was now looking at ways to legitimize cryptocurrencies. The bitcoin technology in Japan is now regulated.
These the factors by themselves have also contributed to the bitcoin price breakout significantly. The market cap on bitcoin today stands at more that $35 Billion according to coinmarketcap.com
The largest volume of transaction in bitcoin trading is carried out in Japanese Yen. Yen has a market volume of 45% and it is closely followed by U.S dollar. The dollar attributes to around 30% of the bitcoin trading volume.
Where is Bitcoin’s Technology Headed? Will Bitcoin Fork?
Despite the recent bitcoin price breakout, there still remain concerns over the underlying technology that builds the bitcoin blockchain.
The future of the technology and the threats over the “hard fork” and relevant debates could still see some price nervousness in the bitcoin blockchain.
In order to understand what is the huge debate about the bitcoin fork, one needs to understand “What is Bitcoin?” and how it is mined.
There are now two sides to the argument. On one hand, you have the BTC (Bitcoin Classic) and the other is BTU (Bitcoin Unlimited).
Bitcoin classic is now facing some delays in processing transactions due to the sheer volume.
The group supporting Bitcoin Unlimited which has emerged recently is in favor of increasing the size of the block. This would, in turn, allow them to bunch more transactions together and process them faster.
Bitcoin holders and investors will not suffer any losses in their coins if a hard-fork occurs. It may only mean that their bitcoins will split into a percentage of Bitcoin Classic and Bitcoin Unlimited. If Bitcoin Unlimited continues to gain support, and the currency will split – we may see a drop from the present bitcoin price breakout.
However, these scaling dilemmas seem to be fading. Despite the debates and the growing support for Bitcoin Unlimited, the price has continued to rally. The bitcoin network thus far has still not accumulated enough support to bring any changes. Investors are not nervous and the momentum is simply attracting new capital.
Bitcoin Price Breakout Conclusion
If you are a regular investor looking at Bitcoin as a new savings medium, you could be diving in amidst much excitement and extreme potential.
Some analysts believe that Bitcoin can one day see a hypothetical value of $1 million per bitcoin. It seems to be far fetched. Yet it is probably as far-fetched as the bitcoin price breakout of $2000 appeared to be back in 2008 when bitcoin started being mined.
The fact that there is increasing state regulation around bitcoin is also helping. Not only have Japan legalized bitcoin, but countries in Europe such as Malta are looking at embracing bitcoin blockchain as part of national strategy.
This increasing regulation is greatly assisting to make cryptocurrency a more attractive investment even to bigger investors. Those who previously were nervous about bitcoin investment due to risk and price swings are now more confident in the future of this digital currency.
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