Bitcoin has had a spectacular beginning of 2021, rising above $40,000 per Bitcoin for the first time ever.
Now, with retail investors increasingly eyeing bitcoin in light of its recent gains, new research shows how bitcoin “whales” accumulated a huge number of bitcoin tokens in December, helping the bitcoin price to never-before-seen highs.
Bitcoin is on a tear.
Meanwhile, bitcoin’s status as “digital gold” has grown in recent months as governments around the world flood markets with unprecedented levels of freshly printed cash – bringing about a surge of big name investors naming bitcoin as a prospective hedge against inflation.
This growing macro-case for bitcoin has vindicated long time bitcoin believers which have cheered the recent price explosion.
Despite these expected “bumps,” most in the bitcoin and cryptocurrency space are predicting the bitcoin price will continue to rise over the long term.
With any substantial change to the economy, there is going to be questions as to how this affects the future of each specific currency pair. Naturally, investors are actually centered on the effect that the loss of the U.S. dollar will have on Bitcoin.
What Is Bitcoin?
Let’s review the basics:
Bitcoin is actually one of many digital currencies. Unlike traditional “fiat” currencies created and operated by a government and central bank, Bitcoin is “mined,” or created by individuals which solve mathematical problems with computing power. Transactions are kept on the blockchain, an encrypted and decentralized ledger that protects the integrity of Bitcoin while at the same ensuring the privacy of the user.
It was the birth of an entirely new financial paradigm.
Bitcoin has had some basic periods since its creation in 2009, but analysts are no longer claiming the “death of Bitcoin.”
Bitcoin More Than Survives In 2020
Bitcoin values fell steadily after sharp rallies in 2013 and 2017, but these declines weren’t precipitated by any significant event spanning multiple asset classes. While it is possible for the prices to fall back down again, you could find yourself being incredibly wealthy from this particular investment if you delay it out long enough.
So the bear market of 2020, brief as it was, marked the first time Bitcoin along with other digital currencies faced a really global crisis that threatened numerous kinds of investments.
Bitcoin bounced quickly, as most of the big institutional funds moved in once they saw how the bitcoin price continued to move higher.