Bitcoin prices have been seen hovering around $4000-$4500 level in the recent past weeks. There is a big possibility now that the most popular cryptocurrency can move beyond $5000 mark. But the point of discussion is what are the factors that are responsible for this much awaited rally?
Certain international events like China’s recent ban on bitcoins and other cryptocurrencies which were responsible for the killing of Bitcoin’s buzz. The return of buzz can bring the buyers back to the Bitcoin market. This ban seemed to be temporary as it is looked as an act to appease hardcore communist members and international agencies. All this is happening ahead of the upcoming Communist Party convention.
Another big driver is the financial crisis which can make the world’s oldest cryptocurrency as a safe haven asset. During the financial crisis more and more investors will flee from other financial assets and will move towards the safer investment venue- Bitcoins. For example- In the year 2008-2009, the financial crises extended to almost all the categories of financial assets.
Another possible event which can push the Bitcoin prices is the regional war prospects in North Korea or the South China Sea. This can really cause a major effect on global trade. Another possible factor comes from the Middle East where Iran and Arabia are heading closer to an open war.
According to the Forbes, a major Wall Street institution can endorse Bitcoin which can be a big source of increasing awareness among the investors. If this happens, the demand for Bitcoin will reach higher and the prices can cross the $5000 mark.
So, the question is how much likely is that any of the factors mentioned above can materialize. Well, the likelihood is good but it can take some time and all we can do is to wait, watch and observe!