By
Steve Muchoki
April 18th, 2024
The value of the digital currency has reached a new record on Thursday, rising by more than $200 this week.
Just two days after surpassing the $1,800 level, bitcoin has reached an all-time high of $1873. The digital currency increased by over 300% this year, owing to a growing demand from around the globe.
At the beginning of the week, bitcoin was estimated at about $1,600, then surpassed $1,700 on Tuesday before escalating over $1,800. After hitting its new record height on Thursday, the price decreased and is currently trading at $1768, according to Coinmarketcap.
The growth of value is attributed to a number of reasons. The Securities and Exchange Commission is now reviewing its decision on the bitcoin exchange-traded fund. In general, regulators are looking into the virtual currency and its underlying technology.
The recent decision by the Japanese government to categorize the virtual currency as a legal payment option in the country resulted in higher bitcoin demand from investors that are looking to put money into digital assets providing growth opportunities.
The implementation of the law is expected to fuel the use of bitcoin in Japan to more than $9 million by 2020, what is five times higher than the 2015’s $1.7 billion of digital currency in circulation.
Pavel Matveev, the co-CEO of blockchain personal finance system Wirex, admitted there is a growth of the long term investment in bitcoin, CNBC reported. He previously forecasted that bitcoin will cost $3,000 by the end of the year.
According to Matveev, investors in Japan are frustrated that the country’s Prime Minister, Shinzo Abe, has failed to stop two decades of deflation.
“Savers have nowhere to put their money,” he told CNBC. “Bitcoin on the other hand has outperformed every traditional currency by a near astronomical margin,” he added. “Now that Japan’s biggest financial institutions are embracing bitcoin, we are in blue sky territory in terms of valuation.”
Meantime, Fran Strajnar, the co-founder of cryptocurrency data provider Brave New Coin, commented: “The world is full of cheap or free credit. There are asset bubbles everywhere from property to retail to bonds.”
“Lots of cheap credit is looking for new safe havens to move into and digital assets are an attractive new asset class. The volatility (of digital currencies) really doesn’t matter as demand greatly outstrips supply,” he said.
“We expect some corrections but have adjusted our outlook and are now feeling that the $1200 to $1800 per bitcoin price band is a temporary consolidation period before undoubtedly climbing up to $3,800 to $8,000 over the next six months.”
Overall, there is an upward trend on the cryptocurrency market. Ethereum is showing a quick growth right now, with its price reaching $103 per coin for the first time. Last month, the value of cryptocurrency Litecoin escalated to $16, its highest price since 2014. The growth is mostly due to the activation of SegWit, the solution that will increase the block size limit, thus accelerating transactions on the litecoin blockchain.