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Bitcoin: Yet another bubble?

CD Equisearch Pvt Ltd | 01 Jan, 2018  | Follow Author | Add to my Favourites 
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Bitcoin has seen approximately 20 fold increase in its price since the beginning of 2017  on Dec 17, 2017 owing to the launch of various bitcoin futures market.  the “deep-seated faith” in the advocates of bitcoin was rewarded by way of the soaring price and this spike was obvious due to  its revolutionary technology.  Meltem Demirors, Director of D“biggest wealth generation opportunity of the century” whichexplains the interest of asset managers in bitcoin.

One of the key drivers behind the increasing value of Bitcoin is its widespread usage rather than other methods.  Bitcoin ATM’s are spreading rapidly since end of 2015. According to Coin ATM Radar, Bitcoin ATM  market in terms of number of locations has grown at~7.6% per month with countries like USA and Canadain the lead. Altcoins  support  on  existing  and  new  machines  reached  31.5%  in  November  as  opposed  to  21.8%  in  August,  2017.  Machines  in  Netherlands grew from 2 at the beginning of the year to 19 by end of November 2017. However, Japan reduced its total bitcoin ATM’s from 16 to 11 between Sept to Nov 2017. As on December 28, 2017, the total number of Bitcoin ATM’s stands at 2001 and growing.

Why is its value soaring?


A  major  reason  for  the  demand  of  this  crypto  currency someone is sending an amount to someone else, but without information linking the transaction to anyone.  encrypted but a full record of every user and every bitcoin is preserved on the publicly available ledger or often  wish  to  participate  in  online  black  markets  and  other  illegal  activities  using  the  anonymity  of  bitcoin.  However,  the bitcoin system is considered to be "pseudonymous" as some suggest that there are possibilities to trace users' real identities.

Web  merchants  routinely  leak  data  about  purchases purchases  according  to  cyber  security  researcherstransactions.  It  links  users  who  want  to  make  similar  payments  and  then  allows  them  to  pay bitcoins, making it difficult to identify them.

Potential vulnerabilities and concerns


Bitcoins critics point out that stability in value is a desirable feature for a currency. However changes at a very high pace. Speculators wish to take site that measures the Bitcoin Volatility Index over different periods of time, Volatility Index is 6.8% and 5.7% respectively.

Crypto currency’ in 2016 stated that the high growth and volatility of both Bitcoinand Ethereum are the result of news, hype, and speculation. This is shown by the extremely high cor currency. When looking at Bitcoin the time-series correlation between price and Google searches for “Bitcoin” is  Ethereum’s correlation is even higher at 0.88. Such high vol of exchange.

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Disclaimer: The author has taken due care and caution to compile and analyse the data. The opinions expressed above are only the views of the author, and not a recommendation to buy or sell. Neither the author nor accept any liability whatsoever arising from the use of any of the above contents.