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Bitcoin Hits Highest Level Since 2018

Bitcoin highs

November 24, 2020 | 

JOHN K MWANIKI |  0 Comments| 

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Bitcoin hits the highest levels since 2018 to trade at $15k. The volatility is a result of US elections and the Covid-19 effects.  

This article looks into the reasons behind the price increase in detail. It also analyzes the future of Bitcoin.

Reasons for the Sustained Bitcoin Price Increase 

Bitcoin surge is not a new phenomenon in the crypto market. It has stayed as such until it now has a seasonal price movement

Every time there have been different reasons for such moves. Here are some of the reasons Bitcoin hits highest levels since 2018;

  • Post-election effects

This is the first US presidential election with an active digital currency economy. The coins have been available for almost a decade; it's when it has become part of the economy.

Leading up to the election, cryptocurrencies betting rose. Several crypto bookers allowed for Bitcoin betting on the expected election outcome. Even though that might have a slight effect, the post-election impact is enormous. 

The major contributing factor is the increased tensions surrounding the elections. Even though the media has called the election for Joe Biden, Donald Trump is yet to concede. He believes there was foul play and wants the courts to overturn the results. These are unprecedented times in the US elections. 

Both pro-Biden and Trump supporters have staged demos over the elections. Such an environment is not great for businesses. Traditional currencies thrive in a stable business environment. That is where Bitcoin comes in.

The currency has set itself apart as a safe haven. It is always the savior when the fiat economy goes down. While the traditional economy suffers, cryptocurrency markets are flourishing.

These developments cement Bitcoin's role as the "digital gold." Bitcoin will still gain as long as the brawl on the elections keeps on.

The boom is also likely to keep on even after the elections. Both of the presidential candidates have favorable policies on virtual currencies. Trump has allowed the crypto world to flourish under his rule. He would do the same if he were to go back to the White House. Biden also favors digital world growth, including digital currencies.

  • Coronavirus pandemic effects

Coronavirus has been a blessing to the crypto world. This sounds absurd to the whole world. It's more like celebrating the pandemic.

It's the Coronavirus effects that started the whole Bitcoin run from March. The pandemic began when the coins were trading at around $5k. It then reduced to hit about $3k when lockdowns were coming in. What followed was a resurgence very few expected.

Most of the traditional sectors came to a halt. The fiat currencies suffered as production went downward. The government had to go in to provide economic stimulus packages.

The government packages cushion the population, yet it weakens the fiat currency. The USD suffered, getting to the lows only seen during the 2008 financial crisis.

A lower value buys fewer cryptocurrencies. This has been the trend over the years leading up to when Bitcoin hits the highest levels since 2018.

Bitcoin had earlier on stayed on sideways movements after hitting $12k. There were fears of a bearish run as the Coronavirus became manageable. However, the second Coronavirus wave is on, restoring the bullish run. 

  • Mainstream adoption

Mainstream adoption of cryptocurrencies has been the latest trend. Earlier on, it was the crypto futures and other derivatives booming. Their success promoted Ethereum and Bitcoin Cash to launch derivatives.

Mainstream adoption has also made merchants accept Bitcoin as a payment method. Thousands of businesses are now accepting Bitcoin. 

PayPal is adopting digital currency. This also pushes Bitcoin to hit the highest level since 2018. It announced its users would be able to buy Bitcoin from the platform. This is a boost to the millions of users of the services. It will open up the businesses accepting PayPal to the crypto world.

Facebook is also still working on its crypto project, Libra. The undying interest of the tech giant company attracts more users to cryptocurrencies. 

  • Unstable stock market 

What's evident is that Bitcoin hits the highest levels since 2018 is a failing stock market. The traditional stock markets have not been the best performing throughout the year.

The stocks have plummeted due to the decline of new money getting into the economy. It has to depend on the government stimulus to stay up. 

Unlike Cryptos that can change very fast, stock markets take time to regain. Once the stocks are down, it takes deliberate measures to ensure productivity. 

The current stock market performance is what Satoshi Nakamoto envisioned when unveiling Bitcoin. The cryptocurrency market provides the needed alternative. 

The Future of Bitcoin

It's normal to wonder what next after Bitcoin hits the highest level since 2018. The volatility of the crypto industry means there's more to come from the coin. The current market state shows a sustained bullish run.

Bitcoin will gain more in the future as the election tension keeps on. The handover of reigns to the next administration is not until 20th January 2021. It means the coin will gain until everything settles after the first month of Q1.

Bitcoin is also likely to gain from the second Coronavirus wave. The world is facing another run of the lockdown. The situation forces the government to give another round of the stimulus package. This, in turn, weakens the fiat currencies. It's the cryptos that keep on gaining.

Several other institutional investors are also likely to embrace Bitcoin. As long as the coin attracts newer investors, its value keeps on growing. 

A growing Bitcoin is excellent for the crypto economy. As the leading coin, its state affects the other digital currencies. Its sustained growth increases the market capitalization of the entire market. It also boosts the other digital currencies. Ethereum, Ripple, Tether, and the other coins will all be in a bullish run.

Bitcoin is likely to hit $20k before the end of the year. 

Bottom Line

Bitcoin hits the highest levels since 2018 in one of the most sustained gains ever. The coin started rising in March and has been at it ever since. It has grown from the lows of $3k to now over $15k.

The growth over the period has been due to the declining fiat economy. Bitcoin has since then established itself as a safe haven.

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