Bitcoin has started a new kind of digital gold rush, especially with its third halving that prompted an unbelievable bull cycle. Now, after a year of the initial bull cycle, we still see huge growth in the value of Bitcoin, its market cap, and a rise in the number of investors.
The predictions about the future are flooding in, and there are many optimistic projections that investors should take into consideration when they are making their decisions. In this article, we provide an overview of some of the factors that have driven this kind of growth and future price predictions.
Bull Cycle Overview
The bull market phase of Bitcoin is expected after a halving; the event that occurs after 210,000 blocks have been added to blockchain more specifically, it is expected to happen approximately every four years. It is also said that inflation will be halved because the compensation of the miners (a block reward set by Satoshi Nakamoto) is also cut in half.
In particular, until the first half of 2012, the reward was 50 BTC, then it got reduced to 25 BTC, and by 2020 it got decreased to 6.25 BTC. Needless to say, the halving will also continue to slow down the issue of new BTC, which will result in greater demand than supply. This is, in a nutshell, what happens after each halving. But regarding this cycle, there were other factors that have triggered the growth of Bitcoin.
Generally, the price of Bitcoin is formed based on the position of several factors, such as the market cap and popularity of competitive cryptocurrencies, the liquidity of Bitcoin, and the relationship between the supply and demand. As we mentioned earlier, the entire supply of BTC is 21 million BTC at the same time the rate at which new BTC is produced is slowing down. Hence, the demand is rising, which also means that the value of BTC is growing.
The liquidity of BTC (the rate at which BTC can be sold and bought) is high, and Bitcoin is widely available on a plethora of exchange sites, among other cryptocurrencies.
One example is the Yuan Pay Group which is an automated trading site where users can sign up by making a minimal deposit of $250. The greatest advantage is that the automated trading system has high execution speeds and quickly assesses the market conditions. Plus, you can trade on the move around your schedule and make an investment in e-Yuan which is a top alternative to Bitcoin.
When it comes to the competition on the network, Bitcoin is one of the best performing cryptocurrencies, and its market cap is much bigger than the other currencies. Actually, its market cap has risen over $1 trillion. The price in 2020 has increased by over 200%. Initially, after the halving, it was around $9,000, and by November, it had surpassed $19,000, after a period of steady rise. By the end of December, it had a twofold increase of over $20,000. Today it is worth over $60,000.
Some of the forecasts by many experts are that it will end 2021 with a price of $100,000. But others believe that based on the historical pattern, it could break $300,000 by December 2021, while the threshold of $100,000 is expected to be hit this summer.
Other supporters are not that optimistic and feel that the bull run will slow down. However, their prediction is still pretty great for crypto investors. They feel that there is a possibility for Bitcoin to increase to $96,000 in 2023 and climb over $100,000 in 2025, after the fourth halving event that is scheduled to happen in 2024. In conclusion, Bitcoin is still one of the most sought-after currencies, and it is regarded as the latest global tulip mania. The last investment of Tesla worth $1.5 billion only further proves this statement.