It has been an interesting past few years for Bitcoin and the entire cryptocurrency market. The ups and downs and regulatory dynamics within the ecosystem warrants close attention from anyone interested in being a part of the industry.
In the crypto marketplace, things can change really fast. Price, regulation and even new innovations can happen at anytime. A cumulative analysis of these factors will make you think that cryptocurrencies have been around for much longer than they actually have.
The past year has been a rollercoaster for the cryptocurrency marketplace. The ups and downs that the ecosystem experienced have had a huge impact on the market perception, adoption and understanding.
Despite the volatility, the Bitcoin market maintained trends that were identifiable. The market moved either upwards, downwards or sideways depending on the period under investigation. Between June 2018 and June 2019, certain crucial indices clearly reveal the prevailing mood of the market, and could serve as a pointer as to what we can expect in the future.
For a market that is barely one decade old, the market capitalization of the cryptocurrency is impressive. Even though the huge swings in the market cause significant variations over short periods, overall the cryptocurrency market has grown faster than any other market before it.
Market Capitalization refers to the total value of the shares of stock of a given entity. It is usually calculated by the value of each share of stock, multiplied by the price of a single share. For Bitcoin, this is usually calculated by multiplying the price of Bitcoin by the total number of Bitcoin in circulation.
In June 2018, the total Market Capitalization of Bitcoin was valued at $101,077,977,782. By June 2019, this has risen to $197,021,640,854, reflecting an increase of $95,943,663,072. What this means is that the Bitcoin market has increased in value by almost $96 billion. This is a significant increase for any market.
This particular index is used to measure the value of any given market or stock. For investors, it is a means of measuring the pulse of the market in order to determine how healthy the market can be for introducing new investments.
A robust market capitalization symbolizes a healthy participation and minimized risk. In this sense, with huge capital in the market, it becomes less prone to manipulation from individuals or groups, hence it is easier for new investors to measure the market potential ahead of introducing their funds into the market. Therefore, we can say that between June 2018 and June 2019, the cryptocurrency market has become healthier to the tune of $95,943,663,072.
Apart from the funds that circulate within any market, the actual product or commodity being traded must be considered when stability is being confirmed. Traded volume measures the level of activity going on in the market, and for the subject under consideration, it can be used to measure the adoption level of cryptocurrencies.
Volume in this context represents the amount of cryptocurrencies that are being traded in the market. This is a significant factor that gives insight into the actual reasons for market behaviours. Traded volume often indicates how healthy the market is at any given time. When there are significant movements, it is the traded volume that gives us an idea of whether the market is being manipulated or whether the moves are genuinely organic.
When there is a significant change in the price of crypto, one of the first things a trader checks is the traded volume within the same period. This will give an insight into whether the price action is over-bloated or robust enough to represent a healthy growth in the market.
A drop in volume is usually not considered a good thing for markets, since it could imply a drop in the level of interest, and investors under such conditions become reluctant to act. On the other hand, increased volume calls for inquisitiveness and increased interest by investors.
The June 2018 volume of Bitcoin was 17,106,061, compared with June 2019, the volume of Bitcoin in the market stands at 17,777,262. Using today’s price, what this implies is that $7,440,263,085 worth of BTC was added to the market in the space of one year.
Price of Bitcoin
In the world of traders, it is said that all the information you need is reflected in price. The price of a commodity is the first thing that jumps at you when you view charts. Even indicators that are used to analyse the markets are derivatives of price action over specific periods of time.
It is common to be confronted with the question “what is the price of Bitcoin today?”, before any other information is requested. The basic determinants of price are the forces of demand and supply. When the price of a specific cryptocurrency rises, it means that there are more buyers than sellers. When the price drops, then the sellers are more.
After achieving an all-time high of $19,896 in December 2017, Bitcoin fell in price, entering into what many referred to as a crypto winter. By June 2018, the price had fallen to $5,906.74. The price hovered around this area for a long time, ranging between the $3,000 and the $5,000 region.
A breakout towards the upside happened at the beginning of April 2019 and has continued. This bullish trend has pushed Bitcoin sharply upwards, and by June 2019 it is now trading at $11,085.
What the current trend implies is that the buyers are back, and are having the upper hand in the market, therefore pushing price to higher levels. Most of the time, the challenge for traders is to find out exactly why more people are either buying or selling commodities, in this case, cryptocurrency. For particular reasons, a lot of users believe that this bullish trend will continue, and may see Bitcoin achieving new lifetime levels by the end of the year.
Considering the above indices, it is clear that in the past year, Bitcoin has experienced significant growth. One is bound to ask for reasons behind this. Putting it in a summarized manner, we would credit this growth to increased adoption.
Bitcoin is beginning to find more easy and applicable uses especially in the mainstream. Payment systems like the tap app and card have made it easy and stressless for users to trade and spend Bitcoin and other cryptocurrencies seamlessly.
The tap prepaid MastercardⓇ enables crypto holders to spend their funds anywhere in the world where Mastercard is accepted. The transactions are without complications the conversions from cryptocurrency to fiat are executed by the cardholder at a time and rate that suits them. Transaction settlements are concluded in fiat in the backend by the Mastercard settlement processes.
Signs show that more growth is expected for Bitcoin and the cryptocurrency market at large. Several innovations are coming up and more people are finding entry into the ecosystem. How far this will go remains to be seen, however, users believe that there is still a lot of potential on the upside for this emerging technology.
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