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The situation is different from three years ago, it will further increase Bitcoin over 20 million won 20
Financial sector, “The main reasons for the rise of Bitcoin are liquidity in the market, the weakness of the dollar, etc.”
PayPal, an online payment company, “invests $ 50 million in Bitcoin from next year”
Ray Dalio, “Government regulations are high even when it has grown to threaten fiat currency”
According to CoinMarketCap, a global cryptocurrency market analysis site on the 20th, the price of bitcoin on this day was $ 18,230 (at 2:00 pm). This is similar to the December 2017 record, which is 2.5 times higher in 11 months than this year’s January 1 ($ 7,203).
Considering the Nasdaq’s 30% rise this year, Bitcoin is recording more than 5x the return. Considering that the bitcoin price plummeted to $ 3,000 at the end of 2018, that’s a real blow.
Bithumb, a domestic cryptocurrency exchange, also traded at 21.09 million won, a 144% increase since the beginning of the year (8.24 million won), at 3pm. Bitcoin’s market cap ($ 324.1 billion 361 trillion won) also increased nearly 2.5 times from the start of the year, approaching Samsung Electronics’ market cap (386 trillion won).
In the industry, the recent price hike is estimated to be different from 2017, when the speculative nature was strong. At the time, in the “don’t ask for investment” atmosphere, if individual investors both you and I were getting hot, this time it means “reasonable increase”.
Putting together financial and expert analysis, the main ingredients driving the current bitcoin price are the overflowing market liquidity, the continued weakness of the dollar and a different stance than the past.
First of all, it’s an analysis that each country’s central banks are competitively releasing money to weather the Corona 19 economic recession as commercial funds are being pushed into the cryptocurrency market. The expectation that the US Biden administration will propose further large-scale stimulus measures after he takes office also fuels the prospect of continuing the cryptocurrency rush. This is definitely a different environment than it was three years ago.
Declining confidence in the dollar, the “doing” of paper money, is also a factor in the price of Bitcoin. Anxiety that the dollar’s position as a key currency is shaken due to large-scale liquidity supply appears to be a strong “ post-state alternative currency ” like bitcoin.
Park Sang-hyun, a researcher at Hi Investment & Securities, said: “The price of bitcoin has a strong tendency to be inversely proportional to the dollar” and diagnosed: “The recent price increase reflects the weakening of confidence in the dollar” . Even in 2017, three years ago, the dollar remained at 103 at the beginning of the year. It was a period of dollar weakness, when the index (which is worth the dollar against major currencies) dropped to 91st level at the end of the year, meaning that if the dollar continues to weaken in the future, the value of bitcoin could increase further.
Unlike in 2017, when governments around the world considered cryptocurrency, it’s also good that the outlook has improved recently. PayPal, the largest online payment company in the world, used by 350 million people worldwide, has announced that it will support payment systems with four types of cryptocurrencies starting next year and, in this case, the cryptocurrency will be used for transactions in real life. Payment company Square has decided to invest $ 50 million, or 1% of its money, in Bitcoin.
SK Securities researcher Han Dae-hoon said, “After Square, PayPal also played a catalytic role in the recent rise in the price of bitcoin.” “Fidelity, an asset management firm, has launched a digital asset service and JP Morgan, a bank of) The movement of global financial companies has also accelerated, as has the provision of banking services to exchanges.”
The news that there were many blockchain and cryptocurrency experts on US President-elect Joe Biden’s business team was also a plus. If these conditions are maintained, the second bitcoin boom should continue for the time being. In a report for institutional investors on the 17th, Citibank of the United States said: “The bull market will continue until the second half of next year” and “The price of bitcoin could exceed $ 318,000 (about 300 million won) in a year”.
However, price volatility is still large and skepticism is also strained as governments don’t know when they will hit the regulatory limit again. Ray Dalio, who is referred to as a hedge fund loan, said: “Bitcoin is highly volatile for use as a medium of exchange and storage of value as a currency. Even if it grows to the point of threatening existing fiat currencies, the government can make illegal”. .
Korea News = Reporter Donghwan Cha
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