Bitcoin Crosses $50,000 For The First Time Since April Amid Increased Adoption And Influx Of Investors
Bitcoin crosses $50,000 for the first time since April amid increased adoption and influx of investors
Because bitcoin has finally crossed the $50,000 mark for the first time since April, it appears to be gaining increased traction. The most important factors contributing to this increase are increased adoption and an influx of new investors into the cryptocurrency space.
Despite predictions that Bitcoin would reach the $100,000 mark by the middle of next year, the world's most popular cryptocurrency has failed to live up to this expectation. According to data from Statista, the stock began the year with a market capitalization of $34,622 and reached a high of $58,734 in March before falling below $35,000 in May.
However, despite the fact that its march to $100,000 this year has been severely slowed, bitcoin appears to be bouncing back from its disappointing slump, having experienced a more than 70% increase since the beginning of May to currently trade at around $50,300.
A year of mixed fortunes for Bitcoin
The year 2021 has been a year of mixed fortunes for the world's most expensive cryptocurrency, with several ups and far too many downs to be considered normal. The impulses of major adopters on the one hand, and regulatory concerns on the other, have been the source of its most serious problems thus far.
The sudden U-turn came less than two months after American billionaire Elon Musk announced that his electric car company, Tesla, had begun accepting Bitcoin as payment. Citing energy-related concerns, Musk announced that the company would no longer accept Bitcoin payments.
In the following days, Bitcoin's price would plummet by 16 percent, causing many investors to suffer losses, while financial experts expressed concerns about the stability of a currency that could be so easily influenced by the opinion of a single individual.
The other issues were primarily of a regulatory nature. In May, the United States launched an investigation into Binance, the world's largest cryptocurrency exchange. The platform was allegedly used for money laundering and tax evasion, according to the investigation. Bitcoin's price fell another 3% as a result of the news, and it is now trading below $50,000 for the first time since March.
After China banned cryptocurrency transactions and warned investors against speculative trading in cryptocurrencies in May, the country's regulatory woes were only going to get worse. Following the announcement, the price of bitcoin plummeted by more than 10%, and it was trading at around $35,000, as Bitcoin miners fled the country in large numbers.
On June 1, 2021, President Nayib Bukele of El Salvador delivered his annual address to the nation, marking the beginning of his second year in office, at the Legislative Assembly in San Salvador.
However, not everything was doom and gloom for the cryptocurrency. El Salvador became the world's first country to adopt Bitcoin as its national currency in June, making it the first country in the world to do so. In spite of strong opposition from the opposition party as well as the general public, President Nayib Bukele and the parliament stood firm in their decision.
Other factors that contributed to Bitcoin's recovery include Microstrategy's acquisition of $490 million worth of Bitcoin, increasing the company's total Bitcoin holdings to 105,000 coins, Twitter CEO Jack Dorsey's insistence that Bitcoin is a major part of the company's future, and Elon Musk's announcement that Tesla is returning to the Bitcoin fold.
