The bitcoin revived and strengthened since the beginning of the month, accumulating a rise of 53% (u $ s1,500). But the most interesting thing is that experts in the virtual currency market predict that it is now heading for US $ 5,000 at the end of the year, that is, they see a potential increase of still 15% more. Apart from the excessive volatility recorded by the virtual currencies, since it is a young and low volume market, so far this year the bitcoin has already revalued 600%.
By how investors have reacted in recent months, it is not only an asset to speculate but also now turn as a refuge. After adjusting last July when it fell below US $ 2,000, in August it has already exceeded the target price it had for December by US $ 1,000. According to analysts, there were two main reasons for the recent rise in bitcoin: the implementation of the SegWit protocol, which increases speed in block chain transactions, and increasing tension between the US and Canada. And North Korea, confirming its role as an active refuge.
On the one hand, the technological change that increases the quantity and quality of information that is capable of processing the blockchain (block chain) was successfully overcome. Thus was born the new "bitcoin cash", which came to remedy a problem that had limited the virtual currency for a long time. The success of the process was reflected in the impulse experienced by the price of bitcoin that recovered US $ 3,000 dollars on August 5.
Simultaneously with this technological revolution emerged a new geopolitical crisis that fueled the appetite of investors for the assets refuge. The verbal escalation between Donald Trump and Kim Jong-un and Pyongyang's possible attack on the Pacific enclave on the island of Guam triggered the typical response of investors seeking shelter in assets such as gold, Swiss franc or and in. In this context, analysts have recalculated target prices for bitcoin in the range of $ 4,500 and $ 5,000.
In this regard, bitcoin has already demonstrated in several episodes its high level of sensitivity to the political risk premium, such as when information about the so-called "Russiagate" was started in May (they investigate the links between Trump and Russia) ; Or after the "brexit" vote in June 2016, or during the US election process. Or France. On this basis, analysts are betting that if the Korean conflict escalates, the bitcoin could reach US $ 5,000. Of course, when you resort to the trend that marks the technical analysis, it causes a chill down the back to investors, because the long-term objective is $ 18,000 in two or three years.
In this sense, the actions of large institutional investors will be definitive, given that if they are convinced about the benefits of virtual currencies and that it is not a bubble like the dotcom of the 2000, and so incorporate them into their Wallets, successive rallies will be seen. In addition, the attitude of the central banks, which are another potential factor for the demand for crypto-currencies, is still pending. For this, it is vital that the capitalization reach levels close to USS500 billion (currently stands at USS125 billion, after starting the year at USS17.5 billion).
Fidelity, who announced that it already allows its customers to use their website to view their shares in Crypt-Coins, through the Coinbase exchange house. This is a case study among employees at Boston headquarters. Today less than 5% of traditional investors are in the market, in three years is projected to be 80%.
It certainly seems like the cryptocurrency market in general (and Bitcoin, specifically), still have a LOT of room for growth, as people realize the power and freedom inherent in using these types of currencies over the bank-manipulated fiats. I am glad to have discovered this market now.