After many years of debate concerning bitcoin, it seems that those who advocated for it have won the battle. Initially, in the early months of 2017, we saw the price of bitcoin got to $1020 for the first time in 3 years. From January to November 20, 2017, there were highs and lows regarding the price. Nevertheless, exactly from November to December, the price of bitcoin has experienced increase but with an all-time high of $19,187.0 representing 9.50% increase on 16 December 2017. Currently, the price of bitcoin has taken a dip to $16,154.1 representing a change of -6.87%.
Why is it too high now?
The price of Bitcoin has skyrocketed more than three times this year. While some may be grumbling from the notional loss of not having the interest of investing earlier, others are smiling because they are reaping the benefit of investing in a “risk” currency.
Recently, the price of bitcoin broke all boundaries when it hit an all-time high of over $18,000 for a single BTC (Bitcoin). This increase has continued to puzzle many as to why the price tends to go high. There are many reasons for this increase, which include:
- The Lightning Protocol: According to cryptocurrency experts, a key reason as to the increase of the price of bitcoin is attributed to the progress made towards the beta test of the lightning network. This is an overlay network built on another existing blockchain. This centralized network utilizes the smart contract functionality within the Blockchain to allow instantaneous payment throughout a network of participants.
- Another theory as to why the price of bitcoin tends to be high now is because of the institutional investors who are preparing for the forthcoming BTC futures exchanges.
- Another reason necessitating this increase is that bitcoin is a “store of value.” A particular group tends to buy and hold bitcoin without selling it for the current market price. As more people try to become part of this group, the demand for bitcoin increases and so also the price.
What to Expect
While many are still optimistic that the price of bitcoin will further see an all-time high, it is important to be on the watch. In as much as bitcoin may be the axiomatic hidden pot of gold for early buyers, the future of cryptocurrency isn’t complete; it is one that is still being written. Remember, in 1994 nobody could have predicted the dominance and worth of open source projects such as Apache and Linux. Therefore, it is the same today, the future of bitcoin and other cryptocurrencies cannot be accurately predicted. One has to relax, buckle up and enjoy the ride while it lasts.
However, with the rate at which the digital currency keeps progressing, there is the likelihood that more holders of the coins may want to keep a tight hold on what they have, thereby pushing the prices upward, at least in the meantime.