Bitcoin has spiked to new highs and optimism has returned to bring in the new decade, 2020, showing little signs that the cryptocurrency is slowing down. This is the best start to the year for Bitcoin since 2012.
Bitcoin, the number one cryptocurrency, has passed $10,400 USD within the last 24 hours, rising by 54 percent, with all signs and expert analysts pointing towards much greater gains in the very near future, even within days to come.
This has left analysts not discussing anymore whether or not Bitcoin is recovering, but now analysing, how high the price of BTC will rise in the current bull run it is experiencing.
The recent price spike has been linked to the following factors.
The US Government
Chairman of the United States Federal Reserve, Jerome Powell, testified before the House of Financial Services Committee on Wednesday 12th February, in regards to the state of the US economy and monetary policy, acknowledging that the federal government is currently in the process of working on a digital currency. Powell went on to state that cryptocurrency adoption would pose a threat to the US Dollar, and acknowledged the need for privacy and private cryptocurrency transactions.
This has sparked a widespread bullish sentiment on social media, with investors getting back in the game.
One in particular who agrees is Bitcoin enthusiast and founding partner of Morgan Creek Capital Management, Anthony Pompliano, who tweeted on February 12th, 2020,
“BREAKING: Fed Chairman Jerome Powell just came out in favor of private transactions for digital currencies. He specifically said “A ledger where you know everybody’s payments is not something that would be particularly attractive in the context of the US. Game On.”
Bitcoin Halving Event
With the halving of Bitcoin rewards due to come in May 2020, there is added interest in the price of Bitcoin, especially now considering that the worlds top cryptocurrency, and other cryptocurrencies alike, are here to stay and they now represent a whole new global asset class.
The halving event is set to send BTC to new all time price highs.
A halving event occurs every four years; this halving event will see the reward for BTC drop to 6.25 Bitcoin. This has many industry observers enthusiastic.
As seen before, when a halving event occurs this encourages the price of BTC to drastically increase. Simple economic theory indicates that a drop in supply means that the price of BTC requires less demand in order for it to increase.
Vijay Ayyar, Head of Asia for cryptocurrency exchange, Luno, has commented on the upcoming halving event in an interview with CNBC,
“I would conjecture most normal people are unaware of it, and when the price starts running, the masses will come in as we’ve seen before. This is slated to happen in May 2020. So any price increase as we’re seeing, people have an eye on May for sure.”
Going on to add that a $15,000 to $16,000 price on Bitcoin is a “reasonable target” by the end of 2020.
Exciting times are coming for BTC, with analysts strongly suggesting that we will see the price of BTC surpass its previous record high in 2017.