The impact of the new crown pneumonia epidemic on the economy continues. The stock and bond markets have recently fluctuated sideways, and everyone seems to have no good place to go. Superimposed on the risk of the recent escalation of geopolitical frictions, the prices of gold and bitcoin have soared, once again proving their hard currency status.
In addition, after rising above the $10,000 mark on July 26, the price of Bitcoin continued to rise, breaking through $11,000 on July 28. This has caused many people to shout that the Bitcoin bull market is coming.
So far, 2020 has proven to be an important year for Bitcoin. So far, the asset has beaten stocks, gold, and almost every other asset.
In an interview with Telegraph Money, a British hedge fund that manages tens of billions of assets said that the market is “before institutional investors adopt the asset, and in terms of Bitcoin, this is also a glorious moment now or forever.” The hedge fund manager is considering adding Bitcoin to its fund, making it possible to allocate up to 30% of the fund’s gold holdings to Bitcoin.
Fund managers predict that if Bitcoin can overcome its “credibility barrier,” it will increase by at least five times by 2023. The rise in the cryptocurrency market along with precious metals bodes well for the emerging financial asset class. It proves to the world that the stories of safe-haven assets are gimmicky, and the digital scarcity of assets is proving their value in the current economic environment.
The potential for more gold assets to flood into cryptocurrencies lies in the growing security threats around the world. In Asia, some wealthy people moved gold overseas, while in the United States and other parts of the world, unrest and protest led to violence and robbery.
Digital storage assets are not physical storage assets and may prove to be another important reason why some gold capital flows into Bitcoin. At the same time, it has also further promoted the impact of Bitcoin on existing assets. According to the type of investors behind it, it can be seen that Bitcoin’s current rebound has just begun.
The reason why users hoard Bitcoin is also very simple. They are optimistic about the future trend of Bitcoin. According to some analysts’ analysis, the current price of Bitcoin has broken through the two-and-a-half-year decline triangle, which means that the future trend of Bitcoin is very high. May continue to rise.
In addition, after the third halving, the cost of bitcoin output by miners has relatively increased, so the relationship between supply and demand has changed to a certain extent. Before the ideal price is reached, hoarding has become the best way for investors to profit. In addition, under the stimulus of the global economy, Bitcoin may also become the new favorite of investors. Compared with the volatile stock market and the gold market with relatively small profit margins, cryptocurrency seems to be more attractive.
Data shows that in 2019, on average, more than 500,000 addresses use Bitcoin as the recipient or sender of funds every day. Compared with ten years ago, the growth rate exceeded 40,000%, because, in 2011, there were only 5,000 daily transactions.
Looking at the new addresses that have been adding over time, the growth of Bitcoin holdings is undeniable. In 2011, an average of 7,100 new addresses was created every day, and the number has soared to more than 350,000. In addition, since the birth of Bitcoin, annual transactions have also increased year by year. Except for 2018, the year’s transaction activity decreased by 21.7% compared with 2017. The number of bitcoin addresses added every month is about 11 million, and there are now more than 500 million bitcoin addresses. Interestingly, of the 1 million transactions that were born on December 14, 2017, more than 800,000 were completed by the new address.
The above figures clearly remind us that Bitcoin has become a “hoard” asset. As more wallets hold more bitcoins, it seems that everyone is waiting for a new round of the bull market.