The bitcoin price crosses a $1,000 line on the very first days of the new year, hitting a three-year high. The course of events looked as follows – the cryptocurrency broke the barrier on January 1, fell back shortly afterwards, and recovered again in the early hours of January 2. Now, bitcoin is trading at $1,027.
Bitcoin started the year 2016 at about $433 and ended the year already at $968 on the very last days.
IBTimes recalls that the steady bitcoin price growth might be closely linked to the latest news from China. The country with one of the biggest trading markets for the cryptocurrency tightened requirements for cross-border transactions in an effort to fight money laundering.
That is why, the popularity of bitcoin in China is easy to explain. Bitcoin was created as a web-based digital currency that can enable transferring money across the globe quickly and anonymously. One of the main advantages of bitcoin is no need for a central authority, which makes the cryptocurrency so attractive for those wanting to get around capital controls, such as China’s.
Experts enumerate other possible reasons for the bitcoin price surge. Such world events as the devaluation of the yuan in China, monetary reforms in India, the economic crisis in Venezuela and the shock results of popular votes in the Brexit referendum, the US presidential election and the Italian constitutional referendum, might have resulted in the increased demand for bitcoins, pushing the price upwards.
Indeed, the situation in India influences the cryptocurrency even though the demonetization process in the country is yet to end. According to Sandeep Goenka, the co-founder of Zebpay, bitcoin market in India is still small, but shows huge potential.
“Yes, it absolutely should be because we have a huge potential Bitcoin market which is still very small. We continued to add 50,000 users and will do more than $15 mln in Bitcoin trades in December. These are small numbers for India”, he says.
Taking into consideration opinions of multiple analysts, we can state that bitcoin is likely to continue its upward movement in 2017. The cryptocurrency can even smash the all-time high point of more than $1,230 set three years ago, in November 2013. In general, the year was very important for bitcoin, whose history has been marked by price volatility. Its price spiked in April and in November 2013, only to crash to below $100. Some experts draw analogy to the current price surge that can also result in a new bubble taking place.
Bitcoin is not the only cryptocurrency that showed good results in 2016. All major cryptocurrencies, including Ethereum, Ripple, Litecoin, Monero and Dash, have gained as well.