A year ago, on January 10, 2020, Bitcoin was priced at $7,808. And it was just this past October that it was hovering in price in the vicinity of $11,000. But to the surprise of observers and almost out of nowhere, the value of Bitcoin was slingshotted past the $41,000 level to hit a new all-time high of $41,660 in the past day.
The second half of 2020 was noteworthy for the flood of institutional money flooding into the cryptocurrency market.
Bitcoin is on a tear.
With a little help from the media, the general public has become curious about the fascination girls have for the brand new venture known as bitcoins. As a currency, it stands out among all others. The problem is a large number of people still do not understand exactly how it works or even just how to use it.
Today, as Bitcoin and cryptocurrency investors try to call just how much this already-huge rally will run, Ethereum cofounder Vitalik Buterin has shown what he thinks is an “underrated” bull case for crypto. “One of the more underrated bull cases for cryptocurrency that I have always believed is simply the fact that gold is actually lame, the younger generations recognize that it is lame, and that nine trillion has to go somewhere,” Buterin wrote in a recent 2020 summary blog post.
Despite these expected “bumps,” most in the bitcoin and cryptocurrency space are predicting the bitcoin price will continue to rise over the long term.
What may perhaps really help make this time different, nevertheless, is not that Bitcoin prices hit new highs in 2020 and finished the season with a mind of steam. It is that the cryptocurrency succeeded in its first trial by fire.
What Exactly Is Bitcoin?
First, a quick refresher for the uninitiated:
Bitcoin is actually a digital currency created in January 2009 following the housing market crash. It follows the ideas set out in a whitepaper by the mysterious and pseudonymous Satoshi Nakamoto.? The identity of the person or perhaps individuals that created the technology is still a mystery. Bitcoin offers the promise of lower transaction costs than traditional online payment mechanisms and is operated by a decentralized authority, unlike government issued currencies.
Majority of people are aware that the name’ bitcoin’ is derived from the’Bitcoins of the virtual currency industry. While there are a lot of people who know about the bitcoins, very few people have read about the satoshi, which is the nickname for the smallest division of Bitcoin. 100 million Satoshis added together equals one Bitcoin.
Indeed, Bitcoin was invented in 2008 and launched in 2009, just as world governments have been printing money to respond to the global economic crisis. A slew of other digital assets followed.
Bitcoin More Than Survives In 2020
Bitcoin prices fell steadily after sharp rallies in 2013 and 2017, but these declines were not precipitated by any serious event spanning multiple asset classes. The digital coin was purely cut by the other advantage of speculation’s blade; worries about hacking risks, for example, hampered cryptocurrencies in 2018.
So the bear market of 2020, brief as it was, marked the first time Bitcoin as well as other digital currencies faced a really global crisis which threatened numerous types of investments.
Those lows were short-lived, however. Digital currencies bounced hardest off the bottom, and Bitcoin turned positive by April.