The Bitcoin went to 15-month high on Monday as the cryptocurrency got something of an endorsement when the new Libra digital currency came out from Tech giant, Facebook.
The cryptocurrency pacesetter went to $11,247.62 on the Bitstamp exchange late on Sunday, its highest valuation since March of last year but it later fell back, most recently up only 1.9% at $11,039.62.
Tech titan Facebook shocked the politicians and the regulators when the company decided too to also go against the federal government’s fiat and go with her own digital coin Libra.
Bitcoin’s gains are reflecting growing optimism among retail investors that the major corporations want to deal with bitcoin and are prepared to shift from Fiat currency.
The belief with market watchers is that Libra will create mass awareness of cryptocurrencies and act as a gateway to a sort of colonization of the masses before the government’s own eyes.
THE COIN IS ABOUT TO HALVE
One of the largest reasons for the bitcoin rally right now, is the cryptocurrency’s next “halving” in May 2020, where the block rewards offered to the bitcoin miners will go to 6.25 coins, down from its current 12.5 coins per block reward. This halving has constrained the supply of the digital currency and this halving has come to make the coin scarcer and of greater benefit to its owner. Experts are predicting the coins value to keep going up in value because they are not keen on waiting for 2021 with the value already high like it was in 2017 when bitcoin was worth a whopping $20000.
Bitcoin relies on so-called “mining” computers that validate blocks of transactions by competing to solve mathematical puzzles every 10 minutes. In return, the first to solve the puzzle and clear the transaction is rewarded new bitcoins. Bitcoin technology was designed by the anonymous Satoshi in a way that the reward for miners’ slashes by a half every four years, a move intended to have a lid on inflation.
Marius Kramer, a social media influencer who currently works with crypto investing app Ember Fund remarked that “Bitcoin always does a 200% pump within 1 year before the halving and another much, much bigger pump in the year after the halving,”. His expectations are big.
Analysts believe that geopolitical tensions are fuel for Bitcoin. The biggest reason for this is because Bitcoin, and other cryptocurrencies, are a huge way for the people to sneer at the those ruling them so they buy into the argument for Bitcoin more and more. These include the US-Iran crisis, the US-China trade war and closer than the aforementioned, the corrupt handlings of the economy by the Nigerian governments and others in Africa.
In late March, bitcoin left a spell of limited price moves and so far, this year it has surged almost 200%, an ascent peppered by double-digit price swings.
Bitcoin’s unpredictable feature has been a boom to the heavy investors like hedge funds, and investors looking for returns on their money just as central banks across the world go for lower interest rates.
