After an exciting and unpredictable year such as 2020, with the pandemic ravishing the economy and everything else with it, the year ahead leaves us with a promise of a brighter future, especially when we’re considering cryptocurrencies. New ways of earning and keeping your capital safe definitely point at these digital coins. As a couple of exhilarating lows at the beginning of the year and record-breaking highs were exhibited in the crypto world, especially concerning Bitcoin (BTC), with a winning streak of multiple all-time highs in the last months of 2020, we couldn’t help but ask ourselves, what’s next for this crypto giant?
It seems that the upward trend was halted abruptly on Monday, as Bitcoin suddenly experienced a plummet in its value. After optimistic estimates made by experts that predicted the coin surpassing $100,000, $170,000, and even $318,000. As the winning streak continued in the first days of the year, it seemed that those forecasts were very realistic. But more recent events shattered hope for investors and coin holders since Bitcoin plummet around 21% over the course of Sunday and Monday – the biggest two-day decline since March, although it’s still up roughly by 89% over the past month. This price tumble cost the market nearly $140 billion in total market cap, also after rising above 1 trillion in total market value last week. Ethereum fell by 12% as well, and smaller coins like XRP and Litecoin also experienced downward trends, about 18% each.
Last week’s record-breaking ATH pinned the value of the coin around $41,000. Which was influenced by a combination of things, such as a slightly weaker dollar and hopeful estimates made by investors and investment banks for potential gains in the next couple of months in this particular field. If we know for a fact that Bitcoin, along with other cryptocurrencies and similar commodities, does the opposite of whatever the dollar is doing, we can conclude that a stronger dollar could have created this downward trend. Since the dollar was up by 0,4% against numerous major currencies, trading was at its strongest. In the light of the recent political events and possible second impeachment of Donald Trump encouraged investors to infuse capital into the dollar, which rose to a consistent two weeks of highs. Investors will still keep a close eye on the growing political uncertainty and a climb in Covid-19 cases in some Asian countries as they might influence the crypto market.
Experts, on the other hand, claim that this retreat in value was most likely temporary since there is still a growing number of investors and owners of cryptocurrencies worldwide. This new-age tech impulse and a strong Bitcoin boom will most likely keep surging and reaching new highs, despite the recent fall. The interest in blockchain technology will also keep rising, and more companies will implement their services in the future, as per numerous advantages and possibilities. So, what will happen to Bitcoin in the near future? Should investors fear another bubble burst, or should they expect the value to push even farther or over expert estimates? We will have to stay patient and keep both eyes peeled to charts and news outlets in order to catch all the recent information. Given that the “golden coins” have proven their resilience to unpredictable circumstances, this will definitely be an interesting year to watch in the cryptocurrency world.