Sunday, September 26, 2021
HomeNewsBitcoin bulls venture out of cover

Bitcoin bulls venture out of cover

Bitcoin price recently jumped the 200-day line. That is considered a good sign. Some optimists are already giving out six-figure price targets.

When the Coinbase crypto exchange went public in April, the Bitcoin craze was at a peak. The price for a unit of the cyber currency, which had only reached a record high of $ 20,000 in December, jumped to $ 64,000, fueled by the announcement by the electric car maker Tesla that it had invested $ 1.5 billion in Bitcoin and Bitcoin as a means of payment wanting to accept. Price targets in the six-digit range were issued, for example by JP Morgan.

But then the bull market ended abruptly. Environmental concerns about the high power consumption spread, Tesla suddenly no longer wanted to accept Bitcoin as a means of payment and in China the government intensified its negative attitude towards Bitcoin miners and banks. Other countries have also announced stricter regulations. The price rattled below the $ 30,000 mark at times, and optimism waned.

Now he’s back. A Bitcoin temporarily cost $ 46,000 again on Wednesday afternoon. Only recently the price crossed the 200-day line, a positive technical signal.

More trading on Coinbase

Coinbase presented quarterly figures: In the second quarter, the trading volume had increased by 1500 percent year-on-year to 462 billion dollars. The number of monthly users rose by 44 percent to 8.8 million. Coinbase warned, however, that this trend did not continue to the same extent in the third quarter. But you are aware that you are in a volatile business.

Because the price of Bitcoin is based on supply and demand. The supply is artificially reduced every few years. New Bitcoin are created when high-performance computers do calculations and confirm transactions on the Bitcoin blockchain. For this they receive Bitcoin as a reward. There are already 18.78 million Bitcoin, there will not be more than 21 million, and that should not be the case until 2140. Bitcoin was launched in 2009 in response to the financial crisis, as a digital currency that cannot be manipulated or increased at will.

There is also no central authority that could do that. Bitcoin is managed decentrally, by miners all over the world. Bitcoin is a grassroots movement and comes from below, says Nikolaus Jilch, money expert at Agenda Austria. Bitcoin is also the only really decentralized cryptocurrency. Programmers often wanted to earn money with the other projects. Buying altcoins (other crypto assets) only ensures bogus diversification. Because should Bitcoin fail, all other crypto assets would be torn down with it, warns Jilch. A lot of fraud is taking place in the confusing crypto sector. Just recently, hackers stole cryptocurrencies worth up to $ 600 million in an attack in the United States, according to the company Poly Network.

Strong fluctuations

Many investors buy Bitcoin and the other crypto assets primarily because they want to get rich. After all, a Bitcoin only cost a few cents twelve years ago. Bitcoin, however, tends to fluctuate strongly. Again and again, this is the undoing of people who buy Bitcoin without any experience. “If you buy at 50,000 euros and it goes down to 25,000 euros – you have to endure that first,” says Jilch. Bitcoin is not suitable for everyone as an investment, you need a high risk tolerance.

He explains the latest price increase by the continuation of the bull market that was interrupted in April. It had gone too far by April, and when Coinbase went public, everything investors had hoped for had happened. That was a case of “buy the rumor, sell the news” (buy on rumors, sell on facts).
Many now believe the $ 100,000 target is within reach. If Bitcoin increases at the same rate as the second largest cryptocurrency, Ethereum, it will soon reach that mark, says Mike McGlone of Bloomberg Intelligence. Bloomberg also cites Tom Lee of Fundstrat Global Advisors who, with the 200-day line crossed, expects Bitcoin to hit $ 100,000 by the end of the year.

Hasan Sheikh
Hasan, who loves technology and games, is studying Computer Engineering at Delhi JNU. He has been writing technology news since 2016.


Please enter your comment!
Please enter your name here

Trending News

Recent Comments