Bitcoin has been soaring in the price for the last few months, but even so, its trajectory since December has been unbelievable for even hardcore crypto enthusiasts. Bitcoin, which was trading at around $22,000 in mid-December, is nearing $50,000, after crossing $47,000 over the last few days.
This most recent rally has been sparked by an announcement on 8th February by Tesla, the autonomous car maker helmed by Elon Musk, that it had bought $1.5 billion worth of Bitcoin, and that it would soon begin accepting cryptocurrencies as payment.
Of course, the overall rally in Bitcoin has been going on for a while now, with the token has increased by over 1100% since March 2020. This is a significant show of confidence in Bitcoin as well as the cryptocurrency space in general, as other crypto tokens have also risen at similar trajectories during this time period.
The prospects of this price rally continuing are extremely high, as the market dynamics indicate that a majority of Bitcoin’s supply is being held. Bitcoin, as with other cryptocurrencies, has a fixed number of tokens in the market, with new tokens only being released periodically during certain times.
Thus, this automatically improves the prospects for the price to increase, with rising demand and fixed supply. Moreover, according to market researcher Glassnode, more than 78% of Bitcoin’s supply is being held by investors rather than being sold, which leaves a very small portion available for trading.
In fact, it is estimated that there are only four million Bitcoins in open circulation, which is a tiny amount considering the various large institutional investors who have entered, and are looking to enter, the crypto space, such as PayPal and Square, along with hedge funds and ETFs, among many others.
It is not just this feeding frenzy that has sent Bitcoin soaring. There are many who believe that crypto and its underlying system, blockchain, can provide solutions to a number of issues and problems in various sectors.
Areas as diverse as retail, shipping, e-commerce and gaming, to name a few, are exploring ways to improve their prospects by applying crypto and blockchain solutions. The online gambling sector, for example, has already seen a lot of success with this.
There are many online casino operators which have begun offering players the option of placing bets through cryptocurrencies such as Bitcoin, while also utilising blockchain networks to improve the safety, reliability and performance of their games and payment systems.
Those interested can find a lot of useful information about this on https://winz.io/, but it is safe to say that with crypto becoming attractive not just to those in the fintech space, its prospects are even better.
One of the biggest factors in any further rally for Bitcoin and other cryptos will be growing acceptance of these tokens in the form of payment. PayPal has begun accepting cryptocurrencies on its platform, and we saw how Tesla has also said that it will do the same in the near future.
More and more platforms and companies offering this option will allow crypto holders a chance to spend their accumulated tokens, which will only increase its circulation and therefore help increase the price as well, while also making it more attractive since people will now be able to spend those tokens without having to convert it back to fiat currency.
However, one big concern is volatility – Bitcoin remains quite volatile, prone to swings in price in both directions, and memories are still fresh of the crash of 2018, when it lost more than half its value in a matter of weeks, following a similar rally throughout 2017.
Nevertheless, the prospects for Bitcoin and cryptocurrencies in general look extremely bright, and we should expect to see this gain more traction in the coming months.