The fact that the bitcoin’s price increase seems to be limited to Bitcoin alone is one of the most striking features of the present price action of Bitcoin. There is a noticeable lack of momentum among several altcoins, in contrast to Bitcoin’s continuing ascent. There has not been the comparable price increase for altcoins, which often follow Bitcoin’s lead during rallies. Bitcoin price surges typically lead to altcoin rallies, as investors turn their focus to other cryptocurrencies once Bitcoin achieves important price levels.
Other major cryptocurrencies, like XRP, are sort of underperforming in comparison to BTC’s recent rally. For instance, XRP’s price fell from $2.44 to $2.38 in the recent days while the bitcoin’s price has been moving higher. This little drop reflects the general apathy among cryptocurrency traders right now. However, Stellar (XLM) and a few other cryptocurrencies are making a full return. XLM’s 27% weekly gain shows that there are still outliers in the altcoin market, even if it’s behind the others. Similar to how certain altcoins are still attracting market attention, Dogecoin has had good price movement due to expectations that the meme-inspired cryptocurrency will someday surpass the $1 mark.
Causes of Bitcoin’s Recent Surge In Price
The present price spike in Bitcoin is being propelled by a handful of important causes. To begin, there has been a resurgence of institutional interest in Bitcoin. The news that Michael Saylor’s business intelligence company, MicroStrategy, is planning to boost its Bitcoin holdings is one of the most noteworthy developments. In an effort to solidify its position as one of the biggest corporate Bitcoin holders, the corporation intends to fund $2 billion in order to acquire further Bitcoin. For years, Saylor has been an outspoken supporter of Bitcoin. The fact that his business is still buying Bitcoin shows that institutional investors are showing a lot of interest in the cryptocurrency. Saylor is likely to announce a fresh purchase of Bitcoin shortly, which will boost the rise even more.
Metaplanet, like MicroStrategy, has been in the news recently for stating intentions to greatly increase its Bitcoin holdings. The fact that Metaplanet may treble its Bitcoin holdings if this happens shows how corporate investors are becoming more interested in trade Bitcoin for their treasury reserves. These developments provide credence to the idea that an increasing number of businesses are entering the Bitcoin market, which is increasing demand and, therefore, driving prices up.
Protecting Your Wealth from Inflation with Bitcoin
This week is an important week from macroeconomic perspective which also underpin the price of bitcoin. The U.S. Non-Farm Payroll (NFP) statistics will be released on Friday and traders and investors will be looking from two perspective. Firstly, they will look at it from hourly wage perspective which gives us further colours into the on going inflation situation in the country. Secondly, the health of the US labour economy,
Recent data on the US inflation has made it clear that the Fed’s war on inflation is not over yet. Market participants generally agree that the United States Federal Reserve is increasingly concerned about inflation. Traders are of the opinion that the Fed will hold its interest rate cut as it was very much clear in their recent tone.
Because there will only ever be 21 million Bitcoins in circulation, the digital currency has long been hailed as a protection against inflation. Assets like Bitcoin might become even more appealing if fiat currencies have their purchase value eroded as a result of central banks, especially the Federal Reserve, printing more money to address economic issues. Given the widespread anxiety about inflation, many see Bitcoin as a safe haven from the inevitable depreciation of fiat currency, similar to the way gold is seen as a store of value.
More and more large financial institutions are looking to diversify their holdings and safeguard themselves from the potential depreciation of more conventional assets by acquiring Bitcoin as a kind of inflation protection. The Fed is under increasing pressure to control inflation, which means that Bitcoin’s value will likely rise as a hedge.
Where Does Bitcoin Go From Here?
Everyone is wondering whether Bitcoin can maintain its upward pace now that it is once again nearing the $100,000 threshold. The cryptocurrency’s future seems bright in light of the increased interest from institutions, the enthusiasm from businesses like MicroStrategy and Meltaplanet, and the ongoing support from the macroeconomic climate for Bitcoin as a hedge against inflation.
But you should still think about the hazards. The cryptocurrency market is still quite unpredictable, and regulatory changes or big fluctuations in market mood are two examples of external events that might significantly affect Bitcoin’s price in the near future. Despite these concerns, rising demand from both individual and institutional investors gives the impression that Bitcoin’s long-term prospects are bright.
In summary
Institutional investment, rising demand as an inflation hedge, and good macroeconomic indicators are all contributing to Bitcoin’s meteoric rise in price, which is already approaching $100,000. Bitcoin is still the most important cryptocurrency, while altcoins are falling behind and displaying weak price swings. The Federal Reserve’s inflationary woes and the growing number of businesses using Bitcoin bode well for the cryptocurrency’s future growth in the months to come. With Bitcoin’s ongoing success, the $100,000 mark is probably only the start. As demand for the digital asset develops, much higher milestones will be within reach.
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