Bitcoin (BTC) price has more than doubled in the course of the first half of 2019 after crossing the $8,000 level on Tuesday (May 14). Analysts agree that the cause of the bullish trend is a new wave of new buyers who are flocking the market.
Bitcoin Touches A High Of $8,265 On Tuesday (May 14 11:04 UTC), Exploring The Catalysts
In a bullish morning trading session on Tuesday (May 14), BTC peaked at $8,265 before correcting soon after and consolidating above $8,000. The upsurge marks a doubling of Bitcoin as the peak translates into a 120% growth since January 1st, 2019.
Who Are The Investors Driving The BTC Surge?
One of the most common theories about the catalyst of the current ‘Bitcoin rush’ is speculative “whale” traders who are betting on Bitcoin to regain its $20,017 price of December. Institutional investors are also contributing to the bulls after reneging on their earlier plans to invest in the Crypto market after a prolonged bear market prevailed in much of 2018.
On another perspective, Andy Brenner from National Alliance Securities Company believes that it is practically impossible to determine the type of investors driving the bulls forward. However, logical assumptions can be made such as the scenario in the 2017 Bitcoin rush where retail investors were seen as the force behind the epic market surge at the time.
The Chinese May Be Behind The BTC Bull Run
In the same logic, Brenner perceives that it is the Chinese who are behind the stellar market performance. He believes that most Chinese investors are investing in BTC to diversify their asset portfolios.
In an email to CNBC on Monday (May 13), Brenner points out that that there is a decline of the value of the Renminbi versus the US Dollar which is coinciding with the increase in the bullish momentum.
Technically, a declining Chinese currency leads to losses to holders of the Renminbi and most of them will, therefore, tend to diversify away from wealth held in the Renminbi. Bitcoin, hence, benefits as it is the most publicized asset pair in the media at the time being in the world.
Consumer Acceptance Is Also Taking Effect
The 2018 bear cycle resulted in skepticism especially from retail investors as well as institutions. However, Bitcoin has since matured by being less volatile and acceptance is taking root.
The UK Managing Director for eToro, Iqbal V. Gandham, while speaking to CNBC on Tuesday (May 14) via phone said that the acceptance of BTC from consumers means that negative sentiments are no longer taking a toll on the leading Crypto.
On the other hand, positive sentiments such as the new Samsung and HTC Exodus 1 and 1s smartphone devices that have inbuilt Bitcoin wallets as well as a growing number of marketplaces such as Amazon and Flexa’s Spedn network that accept Cryptos is having a real impact as it is alluring more BTC retail users, as per Gandham’s standpoint.
Whales Are Dominating The Market
David Gerard, another Bitcoin expert attributes the bull run to big holders of BTC who are buying from short sellers in a frenzy that is squeezing short sellers as orders surpass the supply. These whales are then selling off Tokens in the short run and the high velocity of the fixed number of BTC (17 million) is fueling the cycle.
Gerard also believes that a fallout of the popularity of Stablecoins is driving Crypto investors back to BTC as concerns emerge of how factual a Stablecoin like Tether can be fully backed against a Fiat currency. This fear has been elicited after the Bitfinex crisis as its founders are also the team behind the Stablecoin market stability strategy.
In the meantime, BTC continues in its upward trend.