When we speak about cryptocurrency, there are a few terms we can associate it with. The first and foremost word which comes to our mind is that the cryptocurrency market isvolatile. The nature of the market can be attributed to a number of factors, for example; the activity of miners, frequency of the traders, and the demand rate. But the pace of change in the value of crypto is can be attributed to a single largest factor: there is no single financial body or institution to control the crypto market. That is the beauty of virtual currency but there are a lot of risks involved with it as well.
The middle of 2021 saw the value of virtual currencies fall quite a bit! This was led by Bitcoin which fell by more than fifty percent to $30000 in July, from a whopping $64000 in April. The fluctuation in the initial coin price over these months is an ode to the price volatility of cryptocurrency led by Bitcoin.
Since the beginning of 2021, we have seen that Bitcoin has been breaking multiple records. It has been observed that the cyclical Bitcoin bull run occurs every 4 yearspreviously seen in 2013 and 2017. We are currently in that bull run and the latest data suggests that BTC will see two top prices this year or in other words, there is a high possibility that Bitcoin is facing a double bubble in 2021 and if you want to start your journey in the crypto world, visit redot.com to begin.
In previous cycle tops, these bounces could never hold unrealized profits and losses above 0.5. The only bubble which had achieved this is the one in 2013 and the one which is happening in 2021 which supports the fact that BTC is facing a double bubble this year.
Bitcoin price can go $100,000 in 2021 later this year thus making predictions right. There has been over a $14000 upwards change in the value of Bitcoin in the last month and the bull run does not seem to be giving up. It is expected that there will be a peak once again.
Bitcoin Bubble Index
The Bitcoin Bubble Index is an analysis tool that visualizes and indicates the price bubble of Bitcoin. Open source of Github, we get information regarding base price information bubble index, keywords index, 60 days accumulative increase, etc. They accumulate the original and visualize them with the help of e-charts. It is a good tool used by users to get a real-time visual of the bitcoin bubble. The datasets provided by the bubble index are:
- Daily recap on BTC price in USD
- Daily data on the number of unique addresses
- The volume of transactions in BTC
- The level of difficulty of BTC mining
- Informational trends around Bitcoin
- The most recent tweets about Bitcoin
Bitcoin is about to reach the new ATH
In the first part of this article, we have already discussed how bitcoin prices went down by more than half in July from a peak price of $64000 in April but since then the prices have only gone up. There is optimism regarding the value which is likely to go up and surpass the previous peak in April, the bitcoin price will be at an all-time high.
Experts have predicted that not only will it surpass the previous peak but the value will be significantly higher than what we have ever seen before. BTC price may skyrocket to $100,000 by the end of the year. There is significant data to back this statement and has been stated by many experts in the crypto market. The current price of Bitcoin stands at $55,000 in early October and hopes are only high.
Should we expect a Double bubble?
What exactly is a double bubble?? To explain a double bubble, we have to go back to 2013. In this year BTC made a bull run till the bubble dropped by 75% before accumulating a gain of 1,750% in the same year. In simple words, bitcoin prices peaked twice in the same year. This can be termed as the double bubbleThe amount of the two peaks differed significantly and raised the price of Bitcoin to an unprecedented level. Let’s look into what 2021 has to offer
The year 2021 also has shown a similar pattern as 2013. After reaching a peak in April there was a drop in the value of BTC by more than half. Since then, we have been living in a bull market and there are expectations that the bull market will help BTC price cross significantly from the previous peak and reach an all-time high thus delivering a double bubble.
We also have to understand that Bitcoin Bubble is similar to an actual bubble. This situation indicates that the value of Bitcoin will continually rise but the thing about bubbles is that they burst. It is expected that post the second bull run when the value of BTC reaches its second peak the bubble is going to burst ie. the value will decrease significantly after going high.
What BTC/USD chart is telling us
The BTC/USD chart on Redotshows the real-time value of bitcoin in US Dollars so you can pick the right time to buy bitcoin. Some of the websites like Business Insider and ReDot provide the actual BTC price news compared to the general bitcoin price. This value changes in real-time. Newcomers in this market may refer to these sites to get an actual look at the scenario.
We have spoken about the uncertainty and the volatile nature of the crypto market but there is a lot of faith in the crypto market which continues to show promise. Securing currencies via blockchain while mining has revolutionized security and has stopped the entry of counterfeits and duplicate transactions. Blockchain is the future and cryptocurrency, the biggest application till date.
Security is the new need of the hour and hard currencies are not so secure nowadays. Investors will be elated to experience a new peak come to the end of the year. There’s nothing to do now but to wait and watch.