Over the past week, the price of Bitcoin has been rising. According to data from the cryptocurrency website Coindesk, Bitcoin broke through $10,000 on July 26, marking the first time since June 2 that it has reached the $10,000 mark. Ether, Litecoin, Ripple and other virtual currencies also followed suit.
As of press time, the trading price of this virtual currency with the largest market value is close to US$10,174. It has risen by more than 2% in 24 hours and by more than 8% in a week.
William, the chief researcher of OKEx Research, told the International Financial News reporter, “From a technical perspective, Bitcoin has been in a continuous consolidation pattern since July, fluctuating sideways in the range of US$8,900–9,450. On July 20th. Around this time, the price of Bitcoin began to break upward, which means that the market trend has shifted from a horizontal consolidation trend to an upward trend. During the continuous consolidation period, the market has been accumulating strength, and once it breaks through, there will be a big increase-as we have seen, the price of Bitcoin The emergence of ‘7 Lianyang’, successfully stood at the important market psychological price of 10,000 US dollars.”
There are several positive factors behind the rise of Bitcoin:
First of all, Bloomberg News reported that on July 25, the US Federal Court stated that the virtual currency Bitcoin is a “currency” covered by the “Money Transmitter Act” in Washington, DC. The Chief Justice of Washington, DC explained that money is usually a medium of exchange, payment method, or value store, and Bitcoin fits this definition.
The analysis pointed out that although the judgment that Bitcoin is currency has not been formally enacted, the opinions of the federal judge will affect subsequent Bitcoin judgments. U.S. law follows the tradition of case law. Perhaps in the future, this series of chain reactions will promote the legalization of virtual currencies and accelerate the integration of the encryption industry and other industries.
Secondly, the US Office of the Comptroller of the Currency said last week that Bank of America can provide custodial services for customers’ encrypted assets, which has also increased the attractiveness of this asset class to some investors.
In addition, William believes that from a fundamental point of view, the DeFi concept is the main driving force behind the rise of Bitcoin.
The DeFi concept refers to the provision of almost all financial services that traditional financial institutions and centralized institutions (usually banks) can provide through blockchain. In short, Defi is a blockchain-based financial service that integrates traditional financial services into it and uses the unique functions of the blockchain to create new services or financial derivatives.
William said that since June, the market value of DeFi’s locked position has risen from $1 billion to the current $3 billion, which is a very rapid growth. In the “post-halving era”, the cryptocurrency market is seriously lacking “good topics”. From the current point of view, with the success of DeFi projects such as Maker and Compound, DeFi is already one of the few “industry-wide hopes”, focusing on “DeFi ecology” “The concept of Ethereum was sought after by the market, which subsequently led to the rise of Bitcoin.
As the price of Bitcoin has rebounded strongly in recent weeks, investors are optimistic about the recent price trend of Bitcoin.
Peter Brandt, a well-known trader, predicts that the price of Bitcoin will hit a new high and eventually rise to $50,000. Bitcoin’s financing rate in BitMEX (a global professional digital currency futures exchange) is expected to exceed 0.04%. This is nearly 4 times higher than the average financing rate of 0.01%, which means that most people in the market are doing long.
Cointelegraph analyst Joseph Young said that there are signs that Bitcoin will have a big bull market in 2020, and it is expected that Bitcoin will try to return to the historical highs of 2017, and may even break new highs. The unprecedented monetary quantitative easing policy has led to an oversupply of money in most markets, and therefore will accelerate the promotion of Bitcoin as digital gold.