5 reasons to reveal why Bitcoin skyrocketed

Bitcoin hit more than $9,300 on Sunday, hitting a 13-month high, setting a new high since May 10, 2018.

CoinDesk data showed that on June 16, Bitcoin soared to $9,381, an increase of about 7% in the day. This prompted Bitcoin's market capitalization to exceed $165 billion, and the total market capitalization of the cryptocurrency market exceeded $288 billion, a record high this month.


The founder of Morgan Creek said:

“Bitcoin’s year-to-date return is 141%, and the S&P 500’s return is 15% year-to-date. Bitcoin’s return is close to 10 times this year’s stock return.”

After Bitcoin broke through the 8000 integer mark in May, a wave of surges over the weekend further pushed Bitcoin closer to the 10,000-yuan mark, but what is driving this wave of soaring?

1. Data performance: Before the market sentiment generally improved , the trading, computing power and other data reached a new high. CoinMetrics.io data shows that after 18 months, the number of Bitcoin daily active addresses exceeded 1 million on June 14. The data broke through the 1 million integer mark for the first time since November 27, 2017.

On the same day, Blockchain.com data showed that BTC's computing power broke through the historical high point, reaching 62,246,727 TH/s. The previous high was 61866256 TH/s on August 28, 2018. Moreover, the number of BTC transactions per day exceeded 364,000. The highest record of this year appeared in May, during the last round of inflation, the number of transactions exceeded 452,000.

There is a positive correlation between bitcoin computing power and price.


In addition, the mainstream attention to bitcoin has also increased in recent days. According to the Baidu Index, the overall daily average of the Bitcoin search index for the past 7 days was 37,783, an overall increase of 13%.

2. News: "Globalcoin" is about to strike, Bakkt has a mobile phone with nearly 2.4 billion months of active users . The cryptocurrency white paper that will be released on Tuesday is undoubtedly a major driving force behind the current round of bitcoin. Facebook has signed agreements with more than a dozen companies, including Visa, MasterCard, PayPal and Uber, all of whom will support the company's cryptocurrency program.

Many market views have given a high degree of parity to the influence of Facebook's stable currency. The CEO of Grayscale Investment recently announced that Facebook's cryptocurrency will go down in history as a catalyst for the spread of digital assets, including bitcoin, among large-scale consumers around the world.

Two analysts at Royal Bank of Canada (RBC) said in a report last week that Facebook cryptocurrency may be "one of the most important initiatives" in its history.

In addition, Bakkt , which has received much attention from the market, announced last week that it will begin testing its bitcoin futures settled in kind on July 22 this year . Analyst Joseph Young said that Bakkt is expected to change the landscape of the bitcoin market through compliance hosting and insurance.

3. Impact of supply and demand: Bitcoin is about to be halved in 2020. The recent market recovery has revived institutional investors' interest in the field of cryptocurrency. Many industry insiders speculate that the supply of bitcoin is about to fall, which is the reason for pushing up the demand for bitcoin.

AMBCrypto reports that StillMark's co-founder Alyse Killeen said Bitcoin's "supply shock" is coming:

I think what may happen is the impact of the upcoming Bitcoin supply in 2020. We have also seen greater demand for bitcoin, and it is expected that a wider consumer base will be able to reach and be interested in Bitcoin.

Killeen further emphasized the sidechain development of the Bitcoin network and added: "We are studying the introduction of sidechain technology, including Blockstream's Liquid network, which provides new breadth and depth for blockchain use cases, and Finally, there has been progress on the core protocol level of Bitcoin."

4. Exchange Incident: Coin Stops Serving to the US On June 14, Coin Ann officially announced that it will stop providing services to individuals and corporate customers from the United States on Binance.com, and its announcement states that “the user account will continue to be Compliance check." Currency An American users cannot obtain trading channels for cryptocurrencies such as AE, HOT, LINK, NANO, ONE, VET and WTC. In addition, the currency platform BNB can only be traded on eToro.

The Block analyst Larry Cermak said that in the past six months, the website has estimated an estimated 185 million visitors, of which at least 30 million are from the United States. This (an end of the currency service to US users) is a shocking statement that proves that regulators are cracking down on non-US exchanges.

According to CCN, the market believes that Binance , the world's largest cryptocurrency exchange, has stopped providing services to US users, which is the reason for the skyrocketing price of Bitcoin. On June 16, the exchange's platform currency BNB depreciated more than 6.5% against BTC, and its loss increased to 22% since June 13.

Analyst Josh Rager said, "With the US delisting of the Binance ban and other exchanges, people may turn to (select) BTC trading pairs with other major currencies."

5. Macro situation: Bitcoin hedges risk When the RMB depreciates, Bitcoin tends to rise. Recently, the turmoil in the macro situation seems to strengthen Bitcoin's safe-haven asset attributes.

CCN reported that bitcoin seems to respond to the sluggish performance of the yuan over the past 30 days, whether or not it is relevant. Chris Burniske, a partner at venture capital firm Placeholder, found evidence of a strong correlation between the appreciation of bitcoin and the depreciation of the yuan, saying that the price of the Bilco was historically “appreciative” before the depreciation of the yuan. For example, in 2016, BTC became one of the biggest gainers in the RMB market as investors bought cryptocurrencies to bypass national capital controls.


(Bitcoin prices have historically risen before the yuan depreciated | Source: ARK Investment Management Chris Burniske)

After the market is generally bullish on the bitcoin broke the $9000 mark, the market view is generally bullish, with multiple analysts aiming at $10,000.

On June 16, market analyst Josh Rager tweeted that Bitcoin has been operating in a strong parabolic rise for the most recent period of time. If this week's line is able to keep 8800, the parabolic support is not broken. The wave unilaterally rising market will not have a trend reversal for the time being, and the further increase target can be seen near the 10000 integer.

CoinDesk analysts pointed out that as the price of bitcoin rose, the market value of bitcoin increased significantly, and has now risen to 57.1%. From the perspective of indicators, BTC 3, 50, 100-period moving average Jincha has been formed, and after the last such bullish signal (October 2015), BTC has come out of a bull market, so BTC is expected to be In the short term, it will further rise to the next strong resistance near 10,000 US dollars.

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