On October 12, 2017 Bitcoin officially reached $5,000 per coin. With the Kool-Aid man now having ran his first $5K marathon, Bitcoin ushers in a whole new can of butt hurt for all the haters and naysayers of both Bitcoin itself as well other cryptocurrencies like it.This new price has pushed Bitcoin’s overall market cap to over $92 billion for the first time – what is 55% dominance of the total cryptocurrency market cap. We will unquestionably see a lot of market activity in the coming weeks as both proponents and skeptics alike will attempt to dissect the reason for this seemingly apparent madness in Bitcoin’s newly found price hike.
Lets do a quick recap of the 2016-17 year to see how Bitcoin arrived at it’s present day value and give you some mind-boggling stats to back up some of the conjecture.
On September 1st, 2016, Bitcoin was at a bargain price of $572 per coin. Today’s price reflects over a 1,000% increase in the price of Bitcoin in just one year. So what made the price skyrocket?
The Good
For starters there was the roll-out of Segregated Witness (SegWit) which helped solve some of the scaling issues of Bitcoin as well as Litecoin and other alt-coins. Then we have Russia, Japan, South Korea, and China and their adoption and recognition of Bitcoin as a very promising currency as well as the blockchain technology on which Bitcoin itself rests. Then finally have the entire cryptocurrency community at large that have proven to be very forward thinking and a problem solving bunch.
The Bad
Ukraine and Venezuela, two countries that have been ravaged by hyperinflation and as a result have turned to Bitcoin and other alt-coins such as Zcash to preserve the worth of their native currency. It’s essential to understand that any negative economic news on the macro level is always of net benefit to Bitcoin and cryptocurrency at large.
Going Forward
It is unreasonable to assume that Bitcoin will sustain itself at the ~$5,000 mark. It is highly likely we will see a market correction in the form of a pullback in the coming days or weeks, giving those of us who feel left out an opportunity to buy up some crypto at cheaper prices.
Some notable economists predict Bitcoin to reach $10K by 2018. We’re a bit bearish on that sentiment, but considering the already astronomical % gains, it’s not impossible.
Nevertheless, this marks a huge milestone for Bitcoin and cryptocurrency alike. “To the Moon” should be treated as a metaphor for a long and exciting journey and not any one particular destination.