This bullish cycle of bitcoin began officially in July when it once again broke $10,000. This brought Bitcoin back into the headlines and caught the eye of those who sat on the sidelines in 2017.
It became clear that this time, many retail and institutional investors were not going to simply watch as it continued to rise.
Big money and everyday investors dove in head first, the top among them including Grayscale bitcoin fund (GBTC) which currently exceeds 10 billion in crypto assets, and MicroStrategy which just raised another $650M to bring their holdings to $1 billion. Other notable entry's include JPMorgan and Goldman Sachs.
Before today all this activity and Bitcoin's corresponding rising price was classified as 'recovery' - because anything under $19,834 happened once before, when it peaked in 2017.
But as of today, Bitcoin is officially done recovering and back to breaking new ground!
It's still on the rise as I write this, we have now smashed through the previous record and BTC currently sits at $21,346 (at time of publishing).
I expect the momentum to slow down soon, but it could still gain some before then.
Two Main Factors At Play:
It's really the classic law of supply and demand at play here.
The demand we talked about above, mixed with so many investors keeping their Bitcoins completely off of exchanges and in secure offline storage (aka 'cold storage').
Buyers, and there's lots of them, are basically currently forced in to a bidding war over a very limited supply of Bitcoin for sale, driving up the price at an abnormally fast pace.
No end in sight...
Ask the average Bitcoin investor how high they think it will go, and the answers you'll hear indicate most will continue holding on to theirs.
In fact, much of the Bitcoin for sale isn't *really* for sale, in the sense that they're done owning it - it's traders capitalizing on Bitcoin's famous volatility, and swing trading.
Selling some, but at the same time placing buy orders to purchase it back when the price drops, believing any dip will be followed by a rise back to the price they sold at. So far, a trading strategy that has paid off.
The next thing to watch out for: the #2 cryptocurrency launches it's upgraded version - Ethereum 2.0 is expected to give ETH a nice boost as well.