Bitcoin’s Phenomenal Growth and the Factors Driving Its Upward Trend

When bitcoin went past the historical high of $19k + in Dec. 17 it hit a price of $21,K +; after 10 days of continuous rise, BTC is now pegged at $27K +. As of December 27, 2020, bitcoin’s (BTC’s) market value has likewise soared to as much as $500 billion. Based on the factors cited as drivers of the upward trend, the current projection is that BTC prices will still rise.

What is even more notable is that unlike the price surge three years ago, the meteoric rise of BTC prices since July of this year was not driven by manipulative hypes rallied to by ordinary investors. Between July and September, the BTC market received as much as $1 billion in investments coming from traditional financial investors.

Factors that Helped Spawn the Phenomenal Bitcoin Growt

Wall Street analyst Glen Goodman who wrote “The Crypto Trader” says BTC’s phenomenal growth is largely due to the occurrence of the COVID-19 pandemic, which also resulted in the changed views of many asset managers and major Wall Street banks, including the central bank. According to Goodman, some even started the movement of diversifying their investment portfolio by selling their gold holdings and replace them with bitcoins.

Actually, the Crypto Trader book author, still wonders if the phenomenal BTC growth would have happened if the pandemic did not transpire.

Yet it also helped that major online payment processing companies like PayPal and Square, have opened their respective gateways, all set to offer the use of their platform for cryptocurrency trading activities. Paypal is initially accepting Bitcoin, Bitcoin Cash, Ethereum and Litecoin, while Square’s cryptocurrency platform is bitcoin dedicated.

Square Payment by the way is owned by Twitter CEO Jack Dorsey, whose move to integrate bitcoin in his nascent payment processing platform aimed to boost the widespread use of BTC. a move that would naturally increase the value of his own BTC assets — and so it has.

Add to that the fact that cryptocurrency services firms like Paxos, BitPay and Anchorage have filed applications to become a Federal Bank Charter, which if granted, will allow them to act as federally regulated U.S. banks.

Those who took faith with their BTC digital asset even after BTC fell below $4,000 when the coronavirus outbreak started spreading, are now jumping with glee. At that time, many began liquidating their cryptocurrencies, wary that the bubble was already showing signs of bursting. As it is, the contrary happened, potentially rewarding those who held on to their BTCs with a substantial rate of return for every BTC they sell in the crypto market.

I’m Running Out of Real Money, Should I Sell My Bitcoin Now?

Many who are hard up with cash want to know if it’s time to sell their bitcoin assets now, as the government’s pandemic financial assistance is not coming any time soon. Even if Trump insists on raising the stimulus check to $2k, those who have been holding on to their bitcoin assets as fallback of last resort, feel it’s time to sell their BTCs. Otherwise, their credit scores could fall below the level that would qualify them for a personal loan guaranteed approval.

Considering that there is a wide spread between the Annual Percentage Rate (APR) paid on a short term loan and the percentage of return gained from BTC holdings. It seems that there is greater loss of potential income if one is to sell BTC while the price is still rising. As opposed to taking out a 5K loan that comes with an additional 3.5% interest cost. Well anyway, the best way to determine the best option is to seek opinions from expert financial advisers who are also knowledgeable on what is currently going on in the cryptocurrency industry.

Posted by Madelina Feliks