Will Bitcoin's Uptrend Last?
After the soul-crushing fall of the cryptocurrency market in the year 2022, Bitcoin's recent resurgence is sparking newfound optimism among investors. However, the crucial question on the minds of many remains: Will Bitcoin’s upward momentum sustain itself over the long term? Let's try to get to the bottom of it.
Bitcoin price and chart
Bitcoin's Price: 2022-2023 Journey
After reaching its all-time high of around $69,000 in mid-November 2021, Bitcoin embarked on a mostly downward trajectory throughout 2022. This decline was influenced by a combination of macroeconomic factors as well as specific distressing events such as the TerraUSD and FTX collapses. In total, BTC lost over 60% of its peak price during the year.
Luckily, 2023 has been a more favorable year for BTC as the global economy showed signs of stabilization. After bottoming out at around $16,000 in December 2022, Bitcoin found a foothold and began a gradual ascent. As of mid-December 2023, Bitcoin's price hovers around $43,000.
Factors Favoring Bitcoin’s Future Growth
Several factors could support Bitcoin's upward momentum going forward. These include:
Further stabilization of the global economy
The global economy has not yet fully recovered from 2022’s turmoil, but signs of improvement are definitely there. As the inflation starts to ease up and the interest rates stabilize, BTC is gaining more favorable conditions for growth.
Bitcoin's halving is a preprogrammed event on the Bitcoin network that reduces the reward for mining new Bitcoin blocks in half. It occurs roughly every 4 years and is designed to control the supply of Bitcoin and keep the currency deflationary.Historically, Bitcoin halvings have been followed by significant price increases. Most likely the halving projected for April 2024 will not be an exception.
Spot Bitcoin ETFs
There is currently a lot of speculation in the crypto community about the possible imminent approval of the spot Bitcoin ETFs (exchange-traded funds) by the U.S. Securities and Exchange Commission. These ETFs would allow investors to buy and sell Bitcoin directly through traditional brokerages, expanding the cryptocurrency's reach and potentially boosting its price significantly.
A rising price of Bitcoin can create a positive feedback loop, attracting more speculative money into the market. This can further fuel price appreciation and attract even more investors.
The recent upward momentum has been truly encouraging for many people who believe in the potential of Bitcoin, and many factors suggest that this current surge could be among the most robust in Bitcoin's history. Unfortunately, however, predicting the precise duration or extent of this ascent is an impossible task due to the cryptocurrency market's inherent volatility. Therefore investors should always exercise caution and carefully consider the risks involved before making any investment decisions.
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