The next round of bitcoin bull market will be driven by the following seven factors:
- 10 trillion US dollars of negative interest debt
- trade war
- Halving bitcoin in 2020
- Bitcoin is becoming a “safe haven” deal
- Institutional trading volume surged
- The mainstream market is bigger than ever
- Socialist rise
As the BTC price has recently consolidated around $11,000, the current bull market seems to have stepped on the brakes. But this can only be a temporary stop. As the global situation pushes demand for alternative financial systems, the next bull market for Bitcoin will be epic.
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The next round of bitcoin bull market will be driven by the following seven factors
Interchange co-founder Dan Hedl posted an interesting tweet, saying that the next bit of bitcoin bull market will be "huge" for at least seven reasons, including the geopolitical forces that created the perfect storm for Bitcoin. Let us analyze it one by one.
1. 10 trillion negative interest rate debt
The $10 trillion may be a conservative estimate. Earlier this week, it reported that global negative interest rate government debt has exceeded $13 trillion.
More than 40% of global bonds are now unable to bring any profits to holders. In fact, if bondholders hold bonds that exceed the maturity date, they actually get less than they invested.
There is no precedent in financial history, indicating that many central banks’ monetary policies are out of control. When investors are no longer able to get returns from the bond market, they will need to benefit from other places.
2. Trade war
The trade war provoked by the United States caused global stock markets to plummet. Although China and the United States have been negotiating an agreement, Bloomberg Markets expects the truce may be only temporary, and another trade war will break out this fall.
If the US trade tariffs are too high, it may lead to a sharp depreciation of the French currency, prompting investors and savvy business owners to turn to safe-haven assets such as gold or bitcoin. From the performance of the latter, this is a wise investment choice.
3. Bitcoin is halved in 2020
Every time the 210,000 bitcoin blocks are mined, a halving event will occur, which is designed to curb bitcoin inflation. Instead of printing money like the central bank, Bitcoin regulates supply by adjusting the returns of miners.
After two halvings in 2012 and 2016, bitcoin prices have seen a parabolic trend. With the next halving event coming next year and the innumerable factors that did not appear in the previous round of bull markets, the next round of bitcoin bull market will be epic.
4. Bitcoin is becoming a “safe haven” transaction
Investors will move away from one asset class to another based on the degree of perceived risk. Usually, they will withdraw from the stock market during the economic downturn and invest their money in bonds.
But as we have seen from the poor conditions of global bonds, their alternatives are becoming less and less. As stocks and bonds get out of control, real heavyweight investors are beginning to see Bitcoin as a “safe haven” deal.
5. The volume of institutional transactions has surged
The growth of institutional transactions will be an important factor in the next bull market for Bitcoin. Just a few days ago, Bitcoin’s trading premium at Grayscale was as high as 40%, indicating that more money is flowing in.
With the addition of large institutions such as the Intercontinental Exchange (ICE), TD Ameritrade, Fidelity, and so far, this round of the latest bull market is completely different from 2017. Retail investors have not yet entered the market. All price movements come from large sums of money, which will bring another huge boost to Bitcoin.
6. The mainstream market is bigger than ever
People now have a much higher understanding of Bitcoin than they did two years ago, although most people still don't understand Bitcoin or even use it.
More and more places are accepting bitcoin payments. More and more companies are building on the blockchain. More and more companies, such as Facebook, are about to push cryptocurrencies to the public.
The mainstream market is at an all-time high. This means that when the next bitcoin bull market really comes, it will be overwhelming.
7. The rise of socialism
As more socialist movements rise across the world, this could drive the next bit of bitcoin bull market. People are rejecting authoritarian governments and looking for a way to circumvent their rigid monetary policy.
This has been proven in countries such as Iran and Turkey, where the government's free depreciation of local currency is driving people to use bitcoin.
There is no doubt that the next round of bitcoin bull market will be huge. The world's first cryptocurrency is about to be "a big wood."