There is a reason why Bitcoin, also referred to as ‘digital gold, is trending again as the price is soaring. For them, however, this is not simply another market psychology – it is a confluence of various history and economics, sociological and technological protagonisms in movement. Let us examine the Bitcoin’s normal parameters of growth and what other factors may be present to create the current bull trend.
- Institutional Investments Lifts Off Again
The institutional investors have gone from the wait-and-see stance and started investing in Bitcoin.
Application for a bitcoin exchange-traded fund by BlackRock: Investing in bitcoin will soon become mainstream.
Corporate adoption: Even within publicly traded corporations like MicroStrategy, the addition of BTC to its treasury resources, with the indication that the currency will retain high value after a dirty summer, continues.
- Halving Hype: The Supply Squeeze
Programmatically Bitcoin has a halving event every four years which effectively reduces the amount of btc produced as half of the miner’s reward is cut off.
Effect of 2020 Halving: Triggered a bullish cycle that reached its zenith in the latter part of 2021
Hope for 2024 Analysts predict that such dynamics will be observed again, with admonish being crucial.
Maintaining Focus On: Extreme growth in Bitcoin price after the last two bitcoin halvings.
Visual Suggestion:
A chart illustrating all the bitcoin halvings and bitcoin’s price with it.
- Macroeconomic Factors
Global Uncertainty Is Like Playground for Bitcoin:
Persistent Inflation: Put investors on the watch for inflation since it erodes the value of investments in cash.
Central bank strategies: The increasing rates present a challenge to the conventional markets which makes them turn to Bitcoin for investment.
Turbulence in politics and other countries: A crisis does not stop borderless Bitcoin from existing.
Visual Suggestion:
Lyne Chart comparing bitcoin and gold performance over a period
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