How is the 2020 bitcoin rally different from previous ones?

Bitcoin is ready to test the all-time high of $20,000 and even set a new record, but expertswe are sure that this time everything will not be like in 2017, but completely different.

Bitcoin is on the verge of a breakout

The main cryptocurrency is skyrocketing in value. On Wednesday, November 18, the bitcoin price tested new highs around $ 18,500, now the BTC chickens have stabilized at $ 17,800. Experts are sure that this is not the limit. However, this year's Bitcoin rally will not be the same as in 2017 and previous years. The crypto community expects that by the end of the year the value of MTC will reach close to $ 20,000, Bloomberg reports.

Events in recent months have helped spark interestto cryptocurrency. Fidelity Investments has launched a Bitcoin fund. Some famous Wall Street names have bought it. Public Companies Square Inc. and MicroStrategy Inc. have recently invested billions of dollars in this coin. And one of the most notable events for the crypto community was the addition of cryptocurrencies to the PayPal payment system.

Matt Maley of Miller Tabak + Co.notes that institutional investors have begun to pay more attention to the crypto market and Bitcoin. However, the risk of a market collapse remains, especially as retail investors still prefer to hold on. Many were burned by the fall of Bitcoin in 2018 and are now extremely careful.

Additionally, Bitcoin has become more susceptible toexternal factors. For example, the price of cryptocurrency fell sharply immediately after Russia announced the creation of a vaccine against coronavirus, as well as during the announcement of the results of the presidential elections in the United States.

At the same time, the main cryptocurrency showedskyrocketing after institutional investors made major coin purchases, and every time the US Federal Reserve issued another batch of dollars. Saving their assets from inflation, investors urgently transferred money to cryptocurrencies, pushing the price of MTC up.

“Bitcoin is gaining attention when traditionalmarkets are falling and the world economy is sinking. We see that the activity of investors in the cryptocurrency market increased during the aggravation of the epidemic. But the news of the vaccine has brought the price down. "- said Bryce Doty, portfolio manager at Sit Fixed Income Advisors.

Social media keep calm

Experts also argue that the cost of military-technical cooperation is influenced by the activity of users of social networks, in particular, Twitter and Facebook.

Guy Hirsch, US Managing Director atbrokerage company eToro, monitors a somewhat unconventional measure of sentiment: the total number of tweets that mention Bitcoin on a daily basis. At the height of the crypto boom, about 120,000 bitcoin tweets were posted daily. That number now hovers between 30,000 and 60,000, according to data from eToro and The Tie.

“This trend is clearly different for a number of reasons. It is less speculative and less impetuous. Generally speaking, we are very optimistic about what is happening. "- he declared.

Most likely, user activitysocial networks can accelerate price growth. However, today one of the largest social networks, Facebook, blocks any mentions and hashtags related to Bitcoin. In this way, Facebook management is trying to protect users from fraud related to cryptocurrencies, since Twitter and Facebook have become the main tools of crypto scammers.

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