Bitcoin is on the rise, and according to new evidence, the reason may be due to increased buying on cryptocurrency exchanges like Coinbase.
Coinbase Is Bursting with BTC Trades
Bitcoin is trading for just shy of $8,900, though last week, it briefly shot up to the mid-$9,000 range. While originally it was believed that buying activity had increased on derivatives platforms, some analysts believe purchases on spot crypto exchanges may be the real “culprit” behind bitcoin’s meteoric spikes.
Originally, it was believed that the price of futures contracts largely determined bitcoin’s behavior, though this new data suggests otherwise. In the end, it’s good, old-fashioned trading on exchanges that has the most positive effects.
This makes sense considering platforms like Coinbase ultimately shut down during bitcoin’s recent rise past $9,000. The exchange was experiencing harsh technical difficulties that slowed down transaction times and made it nearly impossible for the platform to process all the trades its customers were engaged in.
In addition, the term “bitcoin halving” seems to be garnering a lot more searches on internet engines like Google. Data collected by Google Trends for the month of April suggests that the phrase has surged in popularity, with the number of searches exploding into May. In addition, Weibo – a Chinese social network – reports that the term “bitcoin halving” has become the sixth most popular search in recent weeks. Weibo currently boasts more than 400 million active users.
In about ten days, bitcoin block rewards are set to be heavily reduced for miners. At the time of writing, all miners who extract new coin blocks receive digital rewards in the form of 12.5 BTC, though by mid-May, this number will be reduced to about 6.25. The event has got everyone on the edge of their seats as in the past, halving events have typically proven bullish for bitcoin and respective cryptocurrencies.
Many analysts and enthusiasts believe this halving will offer similar results and claim it will be one of the biggest events in BTC’s elaborate history. Michael Collett – co-founder of the digital currency management platform Stack – explained in a recent interview:
Set against the broader context of excessive monetary easing policies and ‘unlimited’ economic stimuli in major economies, [bitcoin’s recent] gains are likely just the beginning.
The Halving Will Be Here Soon
The uptick in crypto purchases occurring through exchanges is widely attributed to traders not wanting to miss out on what could be huge gains in the coming months. Some analysts are reporting that the halving could drive bitcoin back up to its all-time high of $20,000 again, which it initially reached in December of 2017.
Either way, the surge in buying and bitcoin’s jump of more than $1,000 from one day to the next suggests that the currency is about to enter very bullish territory indeed.