More On: btc
Analyst: Bitcoin prices might soar above $51,000 in the short run owing to a short-term price spike.
The crypto market has added over $600 billion since its January lows, as traders brace themselves for a $10 trillion earthquake, as Bitcoin and other cryptocurrencies have recovered over the previous week.
This is the first time the price of a bitcoin has approached within a few dollars of $50,000 per coin since late December of last year. Some believe that an impending major update to the ethereum network might significantly boost the currency's value. Ethereum is the second most popular cryptocurrency after bitcoin.
It has been suggested that fear of missing out (FOMO) and Bitcoin's fundamentals could push the price above $50,000, while ethereum may be experiencing a "supply squeeze" that pushes its price higher.
An email from deVere Group CEO Nigel Green stated, "Bitcoin is up about 25 percent in the last 10 days, busting through the $35,000-$45,000 zone where it has been stuck since January."
"It's getting closer and closer to the crucial $50,000 mark. As is customary when the price of bitcoin soars, we expect the present bull run to be boosted even further by the onset of crypto FOMO."
Bitcoin's "borderless, worldwide currencies for trade and commerce purposes in our increasingly digitalized economies in which enterprises operate in more than one jurisdiction" may also be a factor in its rise, according to Green.
Many anti-Russian citizens have apparently turned to Bitcoin as an alternative currency since Russia invaded Ukraine and sanctions were placed on the country. A Russian government official even stated that Russia would be open to accepting Bitcoin as a form of payment in foreign markets.
Institutional investors may be gearing up to enter the bitcoin market based on data from other markets
"This is now becoming evident to institutional investors—including credit unions, banks, major funds such as mutual or hedge funds, venture capital funds, insurance companies and pension funds—as well as governments and international organizations," noted Green.
Ethereum may be on the verge of supply-squeeze as the price of bitcoin approaches $50,000, according to data that reveals new ether, the coins that fuel the ethereum blockchain, entering the market are decreasing as more are "burned."
Coindesk first heard from blockchain statistics firm IntoTheBlock in a Telegram broadcast that "after peaking on March 12, the net daily emissions appear to be falling as the demand for the network increases." A "deflationary day" for Ethereum hasn't occurred since February 2, but that might change shortly.
Because of the anticipated shift away from the bitcoin validation methodology of "proof of work" to "proof of stake," Ethereum is preparing for the long anticipated move.
Last year, the Ethereum network began to burn currencies, with more tokens being burned than are allocated to so-called miners who verify blockchain transactions. Within months, ethereum holders will instead "stake" their currencies in order to verify transaction confirmations.
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