Record high: Bitcoin price reaches 30,000 US dollars

Record high: Bitcoin price rises above 31,000 US dollars

The time has finally come: the Bitcoin price has exceeded the gigantic mark of 30,000 US dollars today, 02 January 2021. Current price at the time of going to press: 31,154 US dollars (25,516 EUR). There is currently no sign of signs of fatigue from a deserved consolidation.

How long can the rally keep up the pace northwards?

In the last seven days alone, the bitcoin price has risen by over 20 percent. On a monthly basis, it has even risen by over 50 percent. The market capitalisation of over 550 billion US dollars is now more than impressive, which is also expressed in Bitcoin Future dominance over other cryptocurrencies. This is over 71 per cent and is thus as high as it was last four years ago in January 2017.

However, the altcoin rally, as it has already begun, can hardly keep up with the pace of Bitcoin.

Bitcoin, what else?

No other cryptocurrency is as well-known and easy to acquire as Bitcoin. In the meantime, there are more and more traditional securitisations that allow people to invest in Bitcoin via securities accounts. This ever-expanding product range with securities that have bitcoin as their underlying asset is attractive not only for private investors who shy away from tokens and wallets, but also for institutional investors who are primarily in the regulated securities sector.

The many new funds such as those from Guggenheim or VanEck as well as crypto asset management companies such as Galaxy Digital or Voyager Digital provide institutional access to the cryptocurrency market. The big money only flows where it meets a well-developed infrastructure and liquidity. This is higher for Bitcoin than for altcoins. Accordingly, the Bitcoin price can profit more than other cryptocurrencies from the new institutional interest.

How long will the Bitcoin rally last?

The influx of fresh capital is unlikely to dry up in 2021. After all, only a minority of institutional investors are invested in Bitcoin. Many asset managers will therefore still have to jump on the bandwagon in order to meet the rising client demand.

Even if only small percentages of one percent or less of professionally managed portfolios flow into Bitcoin, then this would quickly pull the market capitalisation to over one trillion US dollars. After all, the big money of pension funds or provident funds has not yet had any contact with Bitcoin. Accordingly, there is plenty of room for the Bitcoin price to rise. However, the institutional professional investors and so-called Bitcoin whales will always provoke setbacks to buy more.

Bitcoin price: It’s just getting started!

Even if it may not seem so to long-time Bitcoin fans, we are still at the beginning of Bitcoin’s establishment. Meanwhile, particularly strong support is coming from central banks such as the ECB and the Fed. With their massive expansion of the money supply, they are not only ensuring asset inflation, but are also fuelling the danger of inflation in the real economy. As digital gold, Bitcoin is thus also receiving tailwind from the central banks to crack further all-time highs in the coming weeks.

Despite the positive outlook, investors should be aware that the Bitcoin price can always set back. The Fear and Greed Index in particular should give one food for thought.

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