Reasons Why Bitcoin Went Above $25K on Thursday
The world of cryptocurrencies is notoriously volatile, with unpredictable price shifts and sudden price swings being more the rule than the exception. In recent years, Bitcoin has established itself as the dominant cryptocurrency, and the value of Bitcoin has frequently been used as a proxy for gauging the overall performance of the market.
On Thursday, the cryptocurrency reached a new milestone, surging past $25,000 for the first time in the previous 8 months. This represents a staggering increase of more than 50% since the beginning of 2023 when its value stood at around $16,000. The surge has left many investors and experts wondering: what exactly is driving Bitcoin’s meteoric rise, and what does this mean for the future of cryptocurrencies and the broader financial landscape?
Worldwide acceptance is growing
There are several factors that could be contributing to Bitcoin’s surge. One of the most significant is the growing mainstream acceptance of cryptocurrencies as a legitimate asset class. In recent months, several major companies, including Pick-n-Pay and major hotels, have announced plans to incorporate cryptocurrencies into their businesses, allowing customers to buy and sell using different cryptocurrency pairs.
Because of this, the credibility and visibility of cryptocurrencies have received a significant boost, which has resulted in greater ease of access for the general public and may encourage the participation of new investors.
Economics vs Regulation
According to observers, a new crypto custody rule that the SEC proposed on Wednesday may make it more difficult for fund managers to invest their clients’ money in cryptocurrencies.
Even after Sam Bankman-FTX Fried’s was allegedly found to have defrauded its consumers of $10 billion, the majority of which is lost, regulatory issues with cryptocurrency have gotten worse. Politically, crypto is in a much weaker position as a result of that enormous scam, with both sides of the political aisle pledging a crackdown on Capitol Hill. Since then, cryptocurrency values have fallen precipitously.
But, according to blockchain analyst Lookonchain, institutional investors have started to return and have invested $1.6 billion in the cryptocurrency market during the previous week.
The surge could be a bubble
However, there are also concerns that the current surge in Bitcoin’s value could be a bubble, with prices being driven up by hype and speculation rather than real value. In the past, Bitcoin has experienced several significant crashes, and some experts worry that a similar collapse could be on the horizon. Additionally, the unregulated nature of cryptocurrencies could make them vulnerable to fraud and manipulation, further complicating the issue.
Despite these concerns, the recent surge in Bitcoin’s value represents a major milestone for the world of cryptocurrencies and has the potential to transform the broader financial landscape. As the world continues to grapple with ongoing economic uncertainty and the rise of digital technologies, cryptocurrencies like Bitcoin may play an increasingly important role in shaping the future of money and finance.
The crypto market is still green
For the time being, the crypto market is showing some positive signs. Despite recent dips and fluctuations, the overall trend in the market is currently upward, with many cryptocurrencies experiencing steady growth and gains. In other words, the crypto market is still in the green.
In concrete terms, at the time of publication, Bitcoin was trading at $24,667.44, up 0.73% from the previous day. The 24-hour trading volume for the BTC/USD pair is $18,676,188,220.
Ethereum (ETH), the second-largest cryptocurrency, is currently trading at $1,696.90, which is an increase of 0.42% in the same timeframe as the previous price point. There was $5.3 billion worth of trades executed in the ETH/USD pair just now.
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