Bitcoin pump: Much of the cryptocurrency community was excited and confused in equal measure after Bitcoin [BTC] crossed the $8000 mark. The majority of the community could not put their head around a reason for this consistent pump, with many analysts and traders stating that there were no fundamental factors affecting the market at the moment.
However, Mike Novogratz, CEO of Galaxy Digital Holdings, pointed out a few developments that might have had a hand in the current valuation spike.
Speaking to CNBC, Novogratz cited Microsoft’s big announcement where they mentioned the initiation of an identity solution on top of the Bitcoin blockchain. Further, Facebook also recently entered the picture after it announced the removal of the ban on cryptocurrency and blockchain-related ads.
These were two of the biggest companies “credentializing” the validity of blockchain and crypto in the market, which inadvertently had an effect on the prices of Bitcoin [BTC].
He added that the initial boom of 2016-2017 was 98 percent based around retail-driven investments, but in the current price hike, some major institutions were prominent as many had started to buy crypto.
One of the other speculated reasons behind Bitcoin’s [BTC] surge was the fact that the market had been tolerant of negative news. The Tether-Bitfinex fiasco hardly affected the price of Bitcoin [BTC], while it still continued to consolidate higher, without any major pullback.
Meltem Demirors, Chief Strategy Officer at Coin Shares, spoke to CNBC about Bitcoin’s rally, stating that 2019’s narrative has shifted back to Bitcoin, from other speculative assets.
“Last year we saw this crazy speculative bubble, we talked about the depths of the crypto crisis, I think a lot of people initially looked at Bitcoin and said ‘oh didn’t scale, it’s not fast enough’, and everyone tried to create new features that Bitcoin didn’t have and they learned that it was hard to do that.”
In the meantime, she continued, that there were a lot of institutions trying to understand Bitcoin and build products and platforms revolving around it.
In the bear market, many institutions concentrated on creating use-cases for Bitcoin and building platforms that help more users around the world to easily access and spend Bitcoin. This was observed with a lot of famous institutions such as Coinbase, Binance, etc.
“As evidence this week, Microsoft, which was working with Ethereum for a long time has decided to move all of its identity work over to Bitcoin network, instead of another implementation of blockchain”
Demirors added that Bitcoin is the world’s largest crypto by market cap and is a brand that is recognized by people all over the world. “Bitcoin’s network is the most secure network,” she added.
The recent Bitcoin rally brought all the hidden bulls out of the closet and people have begun to hail this rally as the new bull run and the end of crypto-winter. Bitcoin’s price, at press time, was $7,904 with a market cap of $140 billion.
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