According to the French "Express" weekly on December 23, after the ecosystem with Bitcoin as the benchmark has experienced various scandals and turmoil, it is easy to be reminiscent of the decline of Bitcoin. But neither the controversy over the Binance exchange nor the loss of ground by rival FTX has put an end to the famed digital asset launched by the mysterious Satoshi Nakamoto in 2008. After falling to less than $16,000 a year ago, Bitcoin** is now approaching $44,000. The all-time peak of about $69,000 reached in November 2021 is just around the corner.
Experts are willing to point out that there are technical reasons for the continuation of bitcoin. While Bitcoin benefits from an environment of trust, it does not live on trust. As long as Bitcoin's blockchain, the independent technology support on which Bitcoin depends, and on which there is no reason to believe it will be destroyed or damaged, will be able to function properly, Bitcoin will continue to transact. FTX and Binance only play a facilitating role, and Bitcoin may be weakened by their activities, but it will never be ruined.
Bitcoin** depends on a range of external economic factors. In times of crisis, inflation or rising interest rates, i.e. in the last two years, its instability and its associated risks are not very attractive. Conversely, when cash flow is abundant, it becomes a speculative tool. As a result, it was a huge hit during the era of COVID and financial easing between 2020 and 2021.
The current period does not meet these criteria. The current Bitcoin surge is largely based on an unwavering belief that there is no end in sight to the cryptocurrency's appreciation. The first is the reason for maneuvering. According to the initial terms of the cryptocurrency, the "halving" planned for 2024 will halve the production of bitcoin. At that time, the total number of bitcoins will be only 21 million. The more scarce and valuable it is, the more wealth there is. The other is historical. In recent years, even with crises, Bitcoin** has never returned below $10,000 before the pandemic. As a result, only a small percentage of investors who bet on Bitcoin at the peak of the "digital" era in 2020 and 2021 are currently losing. Investors in other situations tend to be the winners.
Asset managers know this well: this longevity is an ally. BlackRock, one of the world's largest asset managers, is currently pushing for a dedicated type of market to be set up in the market, a "spot" exchange-traded (ETF) that is very manageable for both institutional and institutional investors. This new financial instrument goes some way to explaining why Bitcoin is currently soaring, with Ether and even other cryptocurrencies likely to join the ETF bandwagon. After all, Bitcoin accounts for "only" 50% of the cryptoasset market, which has grown from $18 billion at the beginning of 2017 to $1 today63 trillion dollars.