The Strategist

Bitcoin is expected to double the growth rate


05/10/2017 - 15:05



Rate of bitcoin, the most popular crypto currency in the world, set a new record of value, going over the mark of $ 1,700 and having increased by 45% in the last month. A new surge of interest in bitcoin has already led some analysts to say that the rate of this crypto currency can reach almost $ 4000by the end of the year.



BTC Keychain
BTC Keychain
Yesterday, the bitcoin rate reached a new record of $ 1,760, thus showing an increase of 45% over the past month. To date, the volume of funds invested in this cyber-currency has exceeded $ 28 billion, growing up by $ 1 billion over a day. CNBC says that just a year ago, the market capitalization of bitcoins was only $ 7.2 billion. Analysts note that the recent surge in popularity resulted in a significant increase in the "long" positions of investors - from 7.6 thousand in early April to 15.3 thousand now. At the same time, the number of "short" positions since the beginning of April remained unchanged - about 17 thousand.

Experts note that investors began to open more "long" positions on bitcoin due to several reasons. One of them was the April decision of the Japanese authorities, which included crypto-currencies in the list of official means of payment on the country’s territory. The bitcoin rate grew by more than $ 100 in two weeks thanks to this decision only. A growing number of the world countries is introducing the cryptocurrency and the blockchain technology. Another reason could be changes made in late April to the code of another crypto currency - lightcoin. These changes boosted speed of transactions and gave hope that similar changes would soon be introduced into the bitcoin trading system.

The growing interest in bitcoin and the rise of its rate have already made some analysts give even more optimistic forecasts regarding this crypto currency. A representative of British consulting company Altus Consulting, Adam Davis, said that the bitcoin rate could reach £ 3000 ($ 3,880) by the end of the year. Mr. Davis explains this by several factors. One of them is growing popularity of bitcoin among the "gray" investors - those who want to invest and save their legal means through international transactions, but without drawing the attention of their countries’ authorities. According to the British consultant, actions of authorities of some countries that either refuse to recognize crypto-currencies and regulate them, or commit ill-considered actions with their own currency - such last year's sudden exchange of banknotes in India - increase people's interest in alternative services and investments, including transfer of part of the funds in bitcoins. Mr. Davis believes that another reason for the explosive growth of bitcoin this year is an increase in economic uncertainty due to Brexit, policy of Donald Trump and slowdown in the growth of the Chinese economy. Investors are also lured by the fact that the crypto-currencies do not depend on direct intervention of authorities of any issuing country, and the demand for this type of crypto-currency is determined by the consumers themselves. 

source: cnbc.com




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