The news just keeps getting better and better for Bitcoin investors after the currency rose above $1,700 per coin on Tuesday. The cryptocurrency has already been on a huge upswing since the beginning of the year with prices up more than 85 percent from what they were on January 1st. Look at it terms of total market capitalization and the numbers become even more impressive.
In fact, this most recent surge in price caused its market capitalization to rise by more than $1 billion in only 24 hours. This impressive feat means that Bitcoin market capitalization has risen by more than $20 billion in the past year, going from $7.16 billion last May to its current level of over $28 billion and rising with every second.
Although this surge in Bitcoin market capitalization and overall price has many investors celebrating, it has also some financial experts focusing on potential future developments that could threaten the currency’s continued rise. Still, the fact is that the recent rises have come at a time when the currency has seemingly successfully navigated through having two Bitcoin exchange-traded funds rejected by the US Securities Commission and the restrictions put in place by China.
However, the issue of the so-called hard fork between various Bitcoin developers is definitely one that could still play a huge role in how it continues to develop. That being said, there has also been several recent pieces of news that bode extremely well for the future of cryptocurrencies.
The first was Japan’s announcement that it would legalize Bitcoin trading beginning in April. This announcement saw the Bitcoin price increase and a noticeable effect of more bitcoins being purchased with yen. Another big announcement came more recently when the Russian government stated that they would also consider legalizing digital currency trading from 2018.
Although the Russian deregulation won’t take place for some time, it still seems that these continued legalization efforts are potentially playing a role in the recent increase in investments. The more markets that are open to more cryptocurrency investment, the more opportunity there is for Bitcoin and the others to grow. Therefore, it only makes sense that more investors are trying to get involved ahead of the curve before the market expands even further.
Considering the exponential level of growth Bitcoin is currently experiencing and the fact that it has been the top performing currency for five out of the past six years—minus a small blip in 2014—it is no wonder that more investors and financial advisors are starting to consider it a safer long-term bet.
Along with this most recent price increase, the number of investors holding a ‘long’ position on Bitcoin—i.e. those who expect the price to rise—also increased on Tuesday to a high of more than 12,200, up from a low just over 7,600 on April 29. This is still lower than the just over 15,000 investors who are shorting the currency and expect the price to drop, but it is still proof that more and more people are beginning to have faith in Bitcoin’s continued potential.
None of this answers the question of whether or not we’re currently seeing a cryptocurrency bubble. However, the fact that more countries are starting to legalize cryptocurrency trading and more major investors are being drawn into the fold seems to point to even greater things for the future and an even greater increase in Bitcoin price.