Why does Bitcoin price remain high?
Richard Montana | October 10, 2021
Today, if you look at the prices of Bitcoin, it has remained higher and close to 50K USD per unit. It has been the case with this digital coin too often. It has maintained its higher price in the market. It will be interesting to know what drives this coin to this meteoric rise. The reasons could vary from one point to another; however, Bitcoin has soared in a big way. It has remained the discussion point by many that seem to have added maturity with its viable investment choice as made by some famous investors and big companies, including retail investors. We see many investors remain bullish about the BTC even when they see it with an all-time high price. You can explore this topic on sites like bitcoinxapp.com to get greater insight, nonetheless going through this post can give an overview of this topic. So, how about taking a plunge into the following paragraphs as under:
The first heading you need to check is inflation and the decreasing buying capacity of the American Dollar. Ever since President Richard Nixon removed the gold yardstick in the seventies, the number of dollars circulating in the market has increased. Since the mid-seventies till date, we have seen the money supply in the market go up from 270 B USD to 4 Trillion USD. Now, it has moved further to reach 6.5 T USD. It has led the government to embark upon a new bill, and they are in talks to draft yet another stimulus bill that would be around 1 Trillion USD. It comes to the target of the people who are suffering from Covid. If this comes up, you could see the government allowing new currency notes very soon. We see countless people in the US suffering from job loss and business losses, the increase in the dollar supply will help them survive and gain the buying capacity in USD.
Let’s understand the low buying capacity of Americans. Many fear that there will be a higher inflation rate. To combat this issue, the investors have to deal with it using their assets. In search of a tangible solution, some investors are now heading towards Bitcoin. There are many more reasons for it. One can find too many assets with higher value in them. Many assets that will remain include the assets like gold or anything similar to this. Gold is a scarce resource. However, no one can verify it with absolute value. It can be a farfetched idea, and many may fail to obtain the same using the mining option. Now, this matters a lot to digital currencies, particularly Bitcoin. Let’s check how.
Bitcoin could make all the difference at this point. The code of this coin remains intact, and you can even verify its existence in the market. It makes Bitcoin remain the key asset on this planet, and it helps in making the supply fixed and finite. Experts say a significant amount of fiscal stimulus can help people greatly, especially during Covid times. It could help in shaping up the economy and moving things ahead once again. It would be interesting to know what brings too much value and the hedge that protects their profiles. Investors need to think again on this issue. They feel that digital currencies, including Bitcoin, could meet the challenge. The government can address this issue by printing more notes.
Thus, it is fair to say that perhaps a small portion of Bitcoin price depends on people’s insecurity against issues like inflation. With an infinite amount of money coming up by the government as per the stimulus bill, people’s problems can disappear. Experts feel that even inflation stays, but printing more notes can help the local people survive. It will make the value of storing assets compelling and gripping. The following key reason is the code called Halving. With the added amount of halving process, the rewards miner will fall by half. It will further help a lot of this transaction. All these factors contribute to making Bitcoin’s price and value remain all-time high when we compare with other digital currencies. The experts feel that this phenomenon may continue but there is of course, no certainty.