Bitcoin broke through $28000, and financial experts dissected three reasons for the surge
At present, because Bitcoin has no legal identity and has not been formally incorporated into the track of formal financial supervision, some artificial manipulation and large household fraud in the process of Bitcoin trading can not be completely eliminated, which is also a risk that investors need to be vigilant.
Around 19:00 on 27 December, Bitcoin continues to attack, Over $28,000 a piece, The 24-hour increase was 13 per cent. At about 16 o’clock the same day, Bitcoin touched $27900 a piece up, The increase expanded to 12.
17 December, Bitcoin broke the $23000 mark, The news also appeared on the Weibo real-time hot spot list. And around 16:00 on the same day, Data Bitstamp the Bitcoin trading platform shows, Bitcoin prices rose to $22,500, A new record. And around 23:20 on December 16, Bitcoin prices rose to around $20670, Up 6.51% in the day, For the first time since 2017, it exceeded $20,000.
As a virtual currency, Bitcoin’s “roller coaster” is not unusual. On November 27, Bitcoin plummeted from a high of $18913 to $16354, down 10.2 percent, with roller coaster ups and downs.
Bitcoin had previously hit $18801 in December 2017. Bitcoin prices have risen by more than 450% since falling below $4000 in march, the year’s lowest price.
Is Bitcoin money?
The ultimate question about bitcoin surfaced again :” is bitcoin money ?” Domestic experts said that for ordinary people, in addition to the central bank issued digital currency, do not touch other so-called virtual currency.
Some practitioners talk about its attributes as Bitcoin rises. When it comes to encrypted money, it is usually best to ban the word “money (money)” in the discussion and talk directly about its attributes, V god, the founder of etheric workshop, has pushed. “Is Bitcoin money ?” It’s not an economic issue, it’s a signal question :” can bitcoin owners put their flags on this mountain that already has dollars, euros and renminbi ?”
On december 11th, the wall street journal reported that one of the top five u.s. life insurers, MassMutual, had purchased $100 million worth of bitcoin for its general insurance account through new york digital investment group (NYDIG), the company said.
More than $6.9 billion of bitcoin is currently held by listed companies, including U.S. software giant MicroStrategy、 asset management company Grayscale and Galaxy Digital, and Jack Dorsey mobile payment platform, according to data
According to a gray capital report ,63% of bitcoin investors surveyed said their decision to invest in bitcoin was affected by the new crown pneumonia epidemic. Because bitcoin seems to have something in common with safe-haven assets, such as scarcity, less correlation with traditional financial markets, and uncontrolled.
First, Bitcoin prices have slid to a low point after the epidemic. As the epidemic is further controlled around the world, especially as the new crown vaccine is about to go public, the global economy may recover. Investors’ sentiment on investment is likely to rise.
Second, under the current global low interest rate situation, according to the U.S. CNBC website, Wall Street is increasingly interested in digital assets. Bitcoin attracts professional investors, and many institutions want to get excess returns through Bitcoin. Bitcoin is also a chip in inflation hedging assets.
Third, S & P Dow Jones Index Co., Ltd. will launch the encrypted currency index in 2021, Bitcoin hit a record high, will attract more financial institutions to enter. In early December, for example, the 169-year-old universal life insurance company in the United States had in Bitcoin. It can be seen that institutional users continue to enter Bitcoin prices through similar gray compliance channels, which is a new trend in driving up Bitcoin prices.
Moreover, if the global economy recovers slowly and loose monetary policy does not shrink, global investment, especially institutional investors, will increase their risk-proof purchases of Bitcoin hedging assets, and Bitcoin prices will rise. Many investors are likely to follow the trend blindly under the influence of the high tide of Bitcoin investment.
According to the data, since November 6 this year, the Bitcoin fear and greed index has remained above 80, which is extremely dangerous and harmful to both extremes of investment.
Expert tip: investment should be cautious!
Historically, Bitcoin price booms and falls have been volatile, and many people have lost their money. Bitcoin’s boom has left 14686 investors shorting Bitcoin futures with about 607 million yuan in 24 hours. Wealth is in an instant, and more people may fall into the abyss of investment by doing more Bitcoin futures.
As global control of the epidemic increases and the pace of economic recovery accelerates, global investment institutions and people’s expectations of inflation will inevitably reduce the amount of Bitcoin investment. Bitcoin prices also have many uncertainties, so investors who favor the upward trend of bitcoin prices will also bring risks to investment.
In addition, Bitcoin is, in any case, a financial investment, not a legal digital currency, but still in a gray area. With the development and introduction of digital currencies around the world, especially the control or suppression of non-statutory digital currencies, the investment space of non-statutory digital currency (Bitcoin) will be greatly reduced and the ability to engage in inflation will be greatly reduced.
In particular, some governments, once Bitcoin investment behavior is strictly restricted, bitcoin prices may collapse at any time. There is also a possibility that at present, because Bitcoin has no legal identity and has not been formally incorporated into the track of formal financial supervision, and some artificial manipulation and household fraud in the course of Bitcoin trading can not be completely eliminated. This is also the risk that the majority of investors need to be vigilant.
The long-silent digital currency Bitcoin has recently skyrocketed. What exactly injected a “strong needle” into Bitcoin’s recent price, and what risks and challenges would it reveal? In any case, blindly hype is tantamount to “speculation air “, solid return to block chain technology is the right way. People have gradually seen the potential of block chain technology, technological progress and regulatory escort is going hand in hand. It is believed that the future block chain consensus algorithm, decentralized governance mechanism and other advantages can be fully released.