Bitcoin Surpasses $13,000 As Momentum Remains Strong
Bitcoin broke past $13,000 today, adding to the litany of milestones it has reached this year.
The digital asset rose to as much as $13,017.96, according to the CoinDesk Bitcoin Price Index (BPI).
At the time of report, the cryptocurrency had pulled back somewhat, trading at $12,997.15
[Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.]
Bitcoin’s Sustained Momentum
The digital currency has had a blockbuster year, breaking through several price levels and generating some very promising returns.
When explaining Bitcoin’s continued gains, analysts have cited several factors, one of them being its sustained momentum.
As the digital currency rises to fresh highs, these record levels draw media attention, resulting in the creation of news stories.
The growing media attention in turn generates visibility for Bitcoin, and the cycle continues.
“News begets news with momentum driving momentum,” said Charles Hayter, co-founder and CEO of digital currency platform CryptoCompare.
Further, there is “no reason for this cycle to stop anytime soon,” said David Johnson, CEO of Latium, a tasking platform that pays its users in cryptocurrency.
Bitcoin participation on a global scale is still quite small and has a lot of room to continue growing. The limited fixed supply coupled with an ever-growing demand creates a self-fueled fire. The momentum and attention creates a self-fulfilling prophecy and that fulfillment starts the cycle over again.
Growing Investor Interest
As Bitcoin has become increasingly visible, both retail and professional investors have flocked to the digital currency, helping drive its price higher.
Travis Parker, COO of IRA Bitcoin LLC, a company that specializes in IRA and 401(k) transfers into bitcoin and other cryptocurrencies, weighed in on this development.
“The newness of bitcoin and other cryptocurrencies, as well as a growing awareness for its retail and commercial applications have sparked mainstream investor interest and attracted hedge funds and asset managers, driving the momentum and volatility we are seeing in recent weeks,” said Parker.
What Will The Future Bring?
As for what Bitcoin’s price will do going forward, experts provided mixed points of view.
The digital currency has entered a bubble, claimed cryptocurrency fund manager Jacob Eliosoff.
Momentum fuels bubbles, emphasized Eliosoff, as prices “get ahead of themselves.”
“The big question isn’t whether the price will crash – it will – but where it will crash to: the seller’s dilemma is it could crash from, say, $50k to $20k, and then start rising again,” he added. “Or it could crash from here back to $2k – the price arguments are that uncertain.”
However, Pawel Kuskowski, CEO & co-founder of Coinfirm, a blockchain and regulatory technology firm, offered a more optimistic point of view.
“In our view for example, we see that the public is now noticing that the traditional and more mass market is actively adopting bitcoin and the blockchain ecosystem,” he said.
“This coming year will be a big year when it comes to more traditional and mass adoption and I think the market is seeing that, reacting to it, and preparing for it.”
Disclosure: I own some Bitcoin and Ether.