It was a year with highlights for bitcoin and cryptocurrencies. After breaking the $ 5,000 mark, it is expected that Bitcoin will exceed $ 6,000 thereafter. At the time of writing, Bitcoin is traded at $ 5,592.56. Cumulatively it has risen by 546% since the beginning of this year.
A bunch of cryptocurrencies including ethereum and litecoin, impersonated the Bitcoin path and cumulative gains range from 4,000% to 1,325%, respectively. In addition to the dynamics inherent in cryptocurrencies (there is a limited number on the market), other factors are working to increase their prices.
Here are two factors that affect Bitcoin’s price now.
Interest of institutional investors
A recent report from the Bank of America attributes the increased value of cryptocurrencies to the interests of institutional investors. While financial service providers are beginning to offer cryptomonies in tailor-made products, Bank of America predicts that it could affect the “liquidity and market capitalization in these currencies.”
European institutions have taken the initiative to design new products using cryptocurrencies. For example, investors can follow the ether course with bank notes traded on the Nasdaq Stock Exchange. The Swiss financial regulator has approved a Falcon Bank product with which its customers can trade bitcoins. American banks follow this example.
Goldman Sachs plans to trade bitcoins, while JP Morgan launched a payment network based on the ethereum blockchain yesterday. These movements can result in a further price increase at all levels.
Interested in Asia
South Korea and China may have broken Bitcoin, but this has not affected the interest of investors in cryptocurrencies. According to reports, investors in both countries pay a premium for investments in bitcoin and cryptocurrencies. Some Bitcoin exchanges through the OKCoin exchange in China have already exceeded the value of $ 6,000.
The regulation of South Korea has resulted in a limited number of cryptocurrencies and high demand. The result is that the Asian country has become the largest market for ethereum. The demand from Japan, which earlier this year recognized Bitcoin as legal tender, could also drive up cryptocurrency prices.