Why Bitcoin price suddenly hiked?
On December 16, the price of Bitcoin broke through the $20,000 mark. In the 11 days since then, the transaction price of Bitcoin continued to set new highs. On December 27, the highest price of Bitcoin was 283.87 million yuan, an increase of more than 40% in 11 days. In a single trading day on December 27, today's opening price was 26536.78 US dollars. As of 19:20 in the evening, the quoted price was 28273.06 US dollars, an increase of 6.57%, and the circulating market value reached 3.24 trillion. In terms of growth rate, in the last 10 trading days, the price of Bitcoin has increased by more than 45%; the price has increased by more than 47% in the past 20 trading days, and the price has increased by more than 116% in the past 60 trading days. The rise and fall of Bitcoin prices have always been the vane of various virtual currencies. Affected by the recent surge in Bitcoin prices, the trading prices of various virtual currencies have been driven up, and the overall market has shown an upward trend in recent days.
1. Bitcoin has become the foothold of global hot money:
This year is a special year. Since the epidemic spread around the world, the central banks of major countries around the world, represented by the Federal Reserve, have adopted looser monetary policies, that is, opening the "money printing machine" model to inject a large amount of liquidity into the market to ease the situation. The liquidity crisis, but the looser monetary policy has resulted in more and more idle funds in the market, especially in the context of the economy has not yet improved and recovered. The real estate market, the stock market and other financial markets, and the Bitcoin and other virtual currency markets are all the focus of hot money. Coupled with the support of capital predators behind the scenes, Bitcoin transaction prices have naturally risen.
2. Bitcoin has the property of fighting inflation:
We mentioned above that a large number of idle funds have accumulated in the market under the loose monetary policy. Under the background of the economic downturn, when the amount of funds accumulates and the total amount of goods does not rise, inflation will occur more or less. When inflation occurs, funds need to find a value-preserving asset for sustenance to avoid a decline in purchasing power and a sharp depreciation of the currency. At this time, fixed assets represented by real estate, securities assets represented by stocks, and resource-based resources represented by US dollars Currency and precious metals represented by gold are high-quality safe-haven assets. In addition to the four types of traditional safe-haven assets mentioned above, because of its unique algorithm, Bitcoin will not exceed 21 million in total, so it will not depreciate because of over-issuance like other currencies. Bitcoin has natural deflationary properties. , To a certain extent, can fight against inflation, which makes Bitcoin an emerging safe-haven asset. Demand rises and prices rise accordingly.
3. Increased recognition of digital assets:
With the popularization of the digital economy, people's recognition of digital assets is also rising. Bitcoin, as a representative of digital assets, has the highest recognition. When Bitcoin is recognized by more people like gold, and when everyone believes that Bitcoin is valuable to reach a consensus on value, Bitcoin will have a market circulation effect, attracting more investors and funds to enter the market, and the price will be pushed up accordingly.