After just a few days of breaking the record $ 30,000 / dong, Bitcoin price surpassed $ 40,000 / dong, pushing the total value of the crypto market to over $ 1,000 billion.
According to the Coin Metrics, Bitcoin price set a new record 40,367 USD/ VND on January 7 session before falling slightly 38,885 USD/copper. This price is still 9.1% higher than the figure a day earlier.
From January 1 to now, Bitcoin price has increased by 30%. Over the past 12 months, Bitcoin’s price skyrocketed by 400%. “With all that happens to Bitcoin, no one will be surprised if the price of the currency surpasses 50,000 USD/ dong at the end of the month “, financial expert Craig Erlam (based in London) told Zing.
“Nobody knows where Bitcoin’s bullish momentum will end,” added the expert.
Coinmarketcap says the total capitalization of the entire crypto market – including Bitcoin and many others – has surpassed the threshold for the first time. 1,000 billion USD in session 7/1. The Bitcoin market alone has a capitalization value 727 billion USD.
Bitcoin acts as an investment asset to hedge against the risk of currency devaluation. Image: Reuters.
Benefit from upheaval in Washington
Financial expert Jeffrey Halley at consulting firm Oanda (USA) said Bitcoin benefited from the riots in Washington.
Early in the afternoon of January 6, crowds of demonstrators supporting US President Donald Trump broke down the barrier outside the Capitol and flooded in while the US Congress was meeting to certify the victory of President-elect Joe Biden.
According to Mr. Halley, US political instability puts pressure on the dollar. “And that is fertile ground for cryptocurrencies. Heavenly prices are inevitable,” he asserted.
Bitcoin’s bullish momentum is also fueled by the “green wave” (Democrats control both the US Congress and the White House). While thousands of protesters flooded the Capitol, control of the US Senate rests with the Democrats, paving the way for President-elect Joe Biden’s economic policies.
On the morning of January 7, US Vice President Mike Pence announced that Joe Biden had officially received 306 electoral votes in the 2020 election. Meanwhile, President Donald Trump only received 232 votes.
Bitcoin price broke $ 39,000 / dong on January 7. Photo: Coindesk.
According to this result, Mr. Biden became US President in the next term. It is likely that a larger stimulus package will help the US economy recover from the pandemic.
Large-scale economic stimulus packages will put pressure on the greenback. Meanwhile, Satoshi Nakamoto – the character or anonymity organization that created Bitcoin – has set a limit of about 21 million units. This limit helps Bitcoin “immune” to inflation, that is, retain value when the dollar depreciates.
Psychological fear of miss
According to financial expert Edward Moya, apart from the “green wave”, Bitcoin’s bullish outlook is even greater after investor Bill Miller voiced his support for cryptocurrencies. The market is underestimating inflation risks, he stressed.
Big name fund managers like Paul Tudor Jones, Stanley Druckenmiller and Mike Novogratz are all optimistic about Bitcoin’s bullish outlook. Payment companies Square and PayPal also allow users to buy and sell Bitcoin and other cryptocurrencies on their platforms.
According to the JPMorgan group of strategists, led by expert Nikolaos Panigirtzoglou, the market cap of Bitcoin will increase by 4.6 times, i.e. each Bitcoin is worth. $ 146,000, on par with private investment inflows in gold (in both ETFs and bullion funds).
The reason is that investment cash flow has shifted from the gold market to cryptocurrency. However, that process will take time. It is not until the price movement of Bitcoin is similar to the gold price movement, this market can attract more institutional investors (investment funds, commercial banks, insurance companies …). “Institutional investors will not allow the currency to slide without braking,” said Moya, an expert at Oanda.
The psychological effect of FOMO (fear of missing out) made the Bitcoin craze even more insane. Both individual and institutional investors have poured money into the crypto market for fear of missing out on the rally.
However, some Wall Street investors warned that Bitcoin’s skyrocketing momentum was just an absurdly inflated bubble. “I will still scream in desperation that Bitcoin is not an investable asset,” warned Jeffrey Halley at Oanda. “Please don’t put your pension in there,” added the expert.
According to the Zing
Riot in the US caused the price of Bitcoin to hit record highs
In the morning session of January 7, the price of Bitcoin increased dramatically to nearly $ 38,000. According to experts, US political instability has warmed to this currency.