Bitcoin is on a five-month winning streak this year, the longest since August 2017. It’s value has risen over 300% this year i.e from ~$3,826 = 1 bitcoin in January to ~$12,284 = 1 bitcoin as at today.
But what could be responsible for this?
- Bitcoin’s price is primarily driven by supply and demand, next year there’s going to be a reduction of supply as the amount of bitcoin produced would be halved. The anticipation of less supply is driving up prices.
- Due to the trade war between the US and China, Chinese investors are stacking bitcoin to protect their wealth. As per Yahoo Finance, some analysts argue Chinese investors are dumping the Chinese yuan for bitcoin, reasoning that bitcoin will likely hold its value more than yuan over the next few months. The Chinese currency fell to its lowest level against the dollar since December earlier this week. Higher demand = Higher price.
- Facebook unveiling Libra – its own cryptocurrency. With prominent companies like Visa, Mastercard and Uber backing a crypto there must be something in it. Increase in perception of value.
What’s on the mind of Bitcoin owners?