Bitcoin has been doing extremely well as of late. Late last week, the world’s number one digital currency by market cap briefly rose above the $60,000 line to bring investors into a whole new state of euphoria. As it turns out, many traders are heavily continuing their bitcoin investing given that several analysts are convinced this is just the tip of the iceberg. Bitcoin is expected to continue rising throughout the year, and there are many individuals out there that are trying to prepare for that.
People Aren’t Stopping When It Comes to Bitcoin Buying
Lennard Neo – a financial analyst and the head of research at Stack Funds – said in an interview:
The spikes in bitcoin outflows from exchanges typically coincides with upside price action in the following days, as investors continue to accumulate during the dips of this bullish market cycle. We expect a similar outcome to unfold this time as well. Bitcoin exchange outflows have currently spiked above the 100,000 level, and during 2020, there were only five occurrences. However, since the start of 2021, this has happened four times in the short span of a few months. The evidence suggests that investors are not only buying the dip, but also accumulating bitcoin at a faster rate… For those critics who still think that bitcoin has no intrinsic value and will not emerge into an asset class, we sincerely urge them to think out of the box.
There are several institutions out there that have already invested hundreds of millions to billions of dollars in bitcoin. Ross Stevens – CEO of Stone Ridge – saw his company invest more than $100 million in the world’s primary digital currency at the end of 2020, and he is certain the company will likely purchase more units in the coming months. He states:
Fiat (money) depreciation causes inflation in fiat premiums, while collapsing the purchasing power of claims. We see a brighter bitcoin-powered future for the billions who depend on the insurance industry every year.
Right now, however, bitcoin is likely doing well given that the standard economy is still in a relatively fragile position, though things could potentially change in the coming weeks as more and more people become vaccinated to fight the ongoing coronavirus. So far, as much as 33 percent of the American population has gotten the first dose of the vaccine, and as this number goes up and people begin entering phase two, we will likely see more businesses open and more economic recovery taking place.
The Economy May Shut BTC Out
Bitcoin, which does well when standard markets endure chaos, could potentially shrink back to smaller numbers should this occur. Chairman of the Federal Reserve Jerome Powell still warns that there is a way to go when it comes to fully fixing the economy, stating:
The economic recovery remains uneven and far from complete.