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Bitcoin owners and traders had their Cyber Monday with the price of the cryptocurrency reaching $ 20,000 on Tuesday.
The price hike comes with more institutional investors, supply halved, transaction support from traditional platforms such as eBay, and recognition and development of the blockchain, a key technology adopted by Bitcoin, industry insiders said.
On Tuesday at 5pm, Bitcoin’s price was around $ 19,500 with a 24-hour high of $ 19,850, a record since 2018, according to Huobi, a leading cryptocurrency trading platform.
“BTC hits a record high and has its big cycle, with market supply halved and other reasons,” said Kang Luzhi, senior analyst at Huobi.
After every 210,000 blocks, each block’s reward, or Bitcoin’s output, will be halved, according to Bitcoin’s mechanism designed by its founder Satoshi Nakamoto.
Bitcoin has grown more than 170% this year, benefiting from an unprecedented rise in demand for risky assets under fiscal and monetary stimulus globally, investors’ thirst for anti-inflation assets, and the expectation that cryptocurrency and its technology will gain mainstream recognition, according to media reports and analysts.
Ti Gong
Bitcoin has risen more than 170 percent this year, hitting a three-year high.
The entry of institutional investments and the Paypal payment platform support for cryptocurrency transactions are a “new power” in the cryptocurrency market to fuel the price of Bitcoin, Kang said.
For example, the Guggenheim Funds Trust filed an amendment to the US Securities and Exchange Commission to invest 10% of the fund’s net asset value in Bitcoin, or $ 500 million, Coindesk reported over the weekend.
Central banks, including the People’s Bank of China, are testing or drafting digital currency plans using various technologies including blockchain.
In October, China’s central bank issued 10 million yuan ($ 1.47 million) of the new e-yuan currency, called electronic digital currency payment (DCEP), in a process in several regions. It made China the first major economy in the world to advance its digital currency.
Bitcoin is the largest blockchain application now, which raises the expectations of global investors regarding cryptocurrency.
Compared to the skyrocketing price of Bitcoin, the prices of the other “coin” cryptocurrencies have remained stable or have risen slightly.
On Tuesday, Chinese cryptocurrency and blockchain trading and instrument companies and supply chain service providers surged in equity markets.
Shenzhen Forms Syntron jumped 4.38% to close at 23.60 yuan. Easy Visible Supply Chain Management gained 2.64% to 8.95 yuan. Hong Kong-listed Huobi was up 5.45% to close at HK $ 3.87 (57 US cents) on Tuesday.
But the market will likely face some fluctuations after hitting the record. The US $ 10,500 line has strong support, Kang said.
China has strong cryptocurrency trading regulations for personal investors and operating platforms, which often carry high risk and fraud.
Chinese regulators shut down Plus Token, a cryptocurrency platform, and seized part of its cryptocurrency assets worth a total of 14.8 billion yuan, including 194,800 Bitcoin. The platform operators have been sentenced to up to 11 years, a court in Jiangsu Province said last week.
There are big differences between China’s official digital currency and cryptocurrencies like Bitcoin.
The official e-yuan will be a fiat currency, based on national credit and a stable value, while cryptocurrencies depend on the consensus of the user community and often have highly volatile fluctuations in value, industry officials said.
