Bitcoin price just crossed the $400 mark! The digital currency has been struggling between the $370s and $380s for weeks before it could break out of the resistance and surge ahead. The increase in price can be contributed to different factors, starting with people trading their altcoins for bitcoin as altcoin prices are exhibiting a downward trend.
Last week ethereum saw an unprecedented increase in value after the price peaked to an all-time high of 0.0171 BTC per ethereum. Over 60000 BTCs were traded in for ethereum during those days. Once the fresh demand for the cryptocurrency subsided, there was a fall in its price.
The recent Bitcoin Roundtable discussion maybe another reason for the increased confidence in Bitcoin in the past couple of days. There were uncertainties regarding the impending hard-fork of the Bitcoin network as part of Bitcoin Classic adoption. All the bitcoin miners, mining pools, wallet providers, exchanges and other bitcoin-related businesses as part of the Bitcoin Roundtable have now unilaterally rejected the implementation of Bitcoin Classic or any other Bitcoin Improvement Proposal that calls for hard-forking of the Blockchain. Any fear regarding the disruption of Bitcoin services have subsided following this decision and trading is returning to normalcy.
One can’t discount holidays and other important days either. Holiday season is known to drive bitcoin price upwards, due to increased spending on gifts, travel etc. The same holds good for Valentine’s Day as well. According to data available from various sources, people are expected to spend close to $20 billion during Valentine’s day. A portion of such huge spending also includes bitcoin payments. Also, Bitcoin companies are not far behind.
Analysis of the price trend shows that the value of bitcoin has been progressively exhibiting an upward trend with small fluctuations within a band. The price rise to $400 is followed by a slight dip of a couple of dollars. If the graph is extrapolated, considering the trading conditions will remain more or less the same, we can say that the price is poised to increase further this week. We may be seeing another $10-$20 increase in value over a period of one week. At the time of posting, the bitcoin price was at around $398.99 (BitStamp).
We may expect a better performance from bitcoin in the coming days. With increased adoption of blockchain technology and increased interest in bitcoin among governments who can possibly work in favor of the digital currency. If the members of Commonwealth of Nations accept the proposals made by the organization’s recent report on virtual currencies, we can see about 50 countries making bitcoin legal in their territories. Backed by the government regulations, bitcoin will enter the mainstream economy in all these nations resulting in increased adoption.
Ref: Chart - Bitcoin Charts (BitStamp data)