Bitcoin has been sailing on choppy waters since mid-2022, with prices continuing to plummet, achieving levels 70% lower than those at the beginning of the year. Put into perspective, 2020 and 2021 have been some of the best years ever since the launch of the crypto back in 2009. Throughout these two years, it continued to achieve new milestones, develop and bring investors much-needed revenue. However, while traders would generally check Bitcoin to ensure they’re conducting transactions at the best time to ensure the maximum amount of returns, doing so became all the more necessary in 2022, when prices continued to drop.
However, the current year has brought renewed hope, as the price of Bitcoin registered a 70% rally that reinvigorated the digital asset market and provided it with new prospects. Now, things seem to be looking up for Bitcoin, despite previous setbacks earlier this year, such as the increasing push for regulations resulting in crypto-friendly banks and financial marketplaces having to cease all operations.
The 30k Mark
Investors have long believed that cryptocurrencies will return to their previous levels sooner rather than later. Their predictions seem to be mostly true, as 2023 has begun with renewed forces for the cryptocurrency market. On April 11th, Bitcoin achieved the $30,000 breakthrough for the first time in nearly a year. The last time the coin was close to this level was in June 2022, and it has only continued to plummet since then. However, the situation has clearly changed, and Bitcoin seems to be on the mend.
This is particularly good news for the entire digital asset market, including the altcoins, tokens and NFTs. Since Bitcoin is the blueprint for all other cyber assets, the blockchain that started it all, the entire market is affected by its changes and fluctuations. And while some rejoice in the latest rally, others are a little more concerned. Although Bitcoin is known as a more volatile asset, and those that want to integrate it into their portfolios can’t be too risk-averse if they want to make it, major price fluctuations remain concerning.
The value hovered at $28,000 for about a month before achieving the final $2,000 in a single day. Some have voiced concerns regarding market manipulation, while others are worried that this means values will register significant fluctuations as time passes. Although many investors have offered their predictions of how they believe the market will develop, the truth is that nobody can accurately estimate how the crypto ecosystem will evolve. All investors can do is remain prepared for the changes and adjust their strategy however they see fit in order to protect their portfolios and capital.
Now that Bitcoin has soared past $30,000, the positive impact it can have on investors’ portfolios has begun to be relevant within the news reports again. And, of course, as a result, the comparisons to gold have been brought up to the surface yet again. BTC has long held the moniker of “digital gold” due to its ability to maintain overall consistent value over time due to continued interest from investors. According to some analysts, considering including gold in your portfolio while neglecting Bitcoin is folly, since the latter is much faster than the former. The price increase has fueled beliefs that cryptocurrencies can act as a reliable store of value when used accordingly.
This is particularly valuable in the context of significant troubles in the traditional financial environment. Banks, weakened by inflation levels, had to raise interest rates, movements that have led many to worry about a possible meltdown. The deepening economic crisis has also caused people to seek alternative methods to protect their money. Cryptocurrencies, offering censorship resistance, as well as transparency and overall higher security measures, seem like the perfect option for this.
So, if you’re concerned about preserving wealth during times of economic uncertainty, adding digital assets to your holdings can be the winning recipe.
When crypto is doing better, the general public naturally begins to trust it more and want to incorporate it into their processes. And, of course, digital solutions, applications, and software are the best place for it, given that Bitcoin is a digital token. One of the latest additions to this trend comes from China, where Douyin, the Chinese counterpart of TikTok, has decided to add Bitcoin to its platform.
This is somewhat in defiance of the crypto ban within the country, with China arguably being one of the nations that have imposed some of the most far-reaching regulations on cryptocurrencies. Until 2021, most cryptocurrency mining occurred in China. However, since then, the nation has driven crypto operations out. The elevated power usage was one of the main concerns that fueled the decision. From then on, a path was laid that saw the United States quickly become the industry leader in Bitcoin creation while China moved toward central bank-regulated digital assets.
The move to make Bitcoin available on the app suggests strong support from the community using the platform. Douyin will also display the Bitcoin price in relation to the Chinese yuan, not the US dollar. Since some places, such as Hong Kong, have become more crypto-friendly recently, it might be the case that China itself will reconsider its stance on cryptocurrencies. This could potentially create a space for markets dominated by the yuan.
The Bottom Line
Over the past few months, Bitcoin has demonstrated once again that it remains a leader in its field, occupying nearly 50% of the market capitalization, one of the highest values since its incipient days. Although altcoins have long tried to catch up, it remains questionable whether any of them will ever be able to truly compete with BTC.
Now that Bitcoin has achieved a new milestone, it has become clear to everyone that a complete return to previous values is only a matter of time. According to reports, Bitcoin is approaching a growth rate of 80%, surpassing all other asset classes. While initially conditions seemed to work against it, the current banking crisis has provided Bitcoin with a spot to shine and show its potential.