The endless growth of bitcoin

Bitcoins are running and the bullish wave is yet to arrive. The digital currency has broken through the 50 thousand dollar threshold in recent days. This hasn't happened since 2021. The increase since the beginning of the year is over 20%, with a capitalization that has exceeded one trillion dollars. After a period of “winter”, there was recovery in 2023 and today it is euphoria. What is going on? Sec, Fed and halving are the three key words to understand this race.

The peak for the digital currency occurred in November 2021, when it reached 69 thousand dollars. Then a continuous up and down. With a free fall in 2022, thanks to the scandal of the FTX trading platform and turbulence in the cryptocurrency industry. The Fed's monetary policy also influenced the so-called “winter”. Investors “treated” bitcoin as a traditional currency and therefore subjected it to the same prudent rules during rate rises. Then came 2023. From 830 million dollars at the beginning of the year it reached 1 billion and 700 million at the end of the year. 2023 was the year of recovery. And January 2024 seems like the first month of a boom year, given the numbers. The reasons?

The first push was certainly the decision of the SEC (the American Consob) on January 10th to approve spot ETFs on bitcoin. And with the green light, the large funds took action and the digital currency rally consolidated. Bullish push also supported by the new rules that have brought some order to a world that scared many. Regulations, such as the European MiCa arriving this year, have reassured traditional operators, who viewed this market with little confidence. And so hence the support. Bitcoin ETFs have seen inflows of $1.1 billion in recent days, for a cumulative total of $2.8 billion since their launch on January 11.

The second push for the acceleration is the prospect of the Fed and central banks slowing down the rise in interest rates. The peak of the squeeze has passed and therefore the world of bitcoin is also ready to rise again.

And then there's the halving on the horizon. It is the halving of bitcoin production that occurs approximately every four years. The next one should be around mid-April. Halving the quantity of bitcoin produced means having more supply and demand, so what? The price is inevitably destined to rise.

This is why, beyond the record forecasts for the next few months (there are those who talk about the threshold of 500 thousand dollars being exceeded), the financial world agrees on the fact that the race has started and the real bullish wave is yet to arrive.