Should it be a cause for worry that the price of the world’s top digital currency, Bitcoin, hit a new high with a seven percent increase in the past 24 hours?
According to CoinMarketCap, the currency - as at the time of this publication - increased by 7.34 percent to push its market cap to $13,934,740,671 at a rate of $867.83 per Bitcoin, having recorded around $198.4 mln worth of transactions within the 24-hour period.
This translates to the addition of more than $1 bln to the market cap of Bitcoin in one day - that is by tomorrow Dec. 23, the market cap would have crossed the $14 bln mark.
If the pace continues at the rate to that which occurred between Wednesday, Dec. 21 and today - which made the market cap swell up from $12.86 bln to $13.85 bln as at the time of writing - the total USD value of Bitcoin supply in circulation, as calculated by the daily average market price across major exchanges, will hit the wider market sooner than expected. This will, in turn, spread its use and adoption.
This momentum is sustainable
Can this momentum be sustained? Matej Michalko, whose DECENT’s startup aims to change the way information and ideas are shared over the Internet, believes that it is. In a chat with Cointelegraph, he notes:
“This momentum is sustainable and it is a harbinger of new cryptocurrency economy enabled by Bitcoin and other cryptocurrencies and Blockchain technologies. We're slowly getting from early to mass markets. We still have a long way ahead of us.”
Price is a function of buy and sell on the exchange market. The more Bitcoins that are bought than sold, the more its price goes up.
The continuing increase in Bitcoin’s price will spur the interests of investors and traders around the world especially those with a focus on Europe where the diminishing value of the euro to the dollar is making the barriers once experienced, owing to the higher exchange rate, disappear.
For David Duccini, the creator of DBA Silicon Prairie Online which was recently approved by the Minnesota Department of Commerce to launch its crowdfunding portal that will result in Blockchain-based implementations of private issues (equity and debt), Bitcoin’s rise is not sustainable in the short-term but possibly in the long run.
He says: “Not in the short run. There is a crowd effect going on — a self-fulfilling prophecy if you will. Over the long run? Yes. Bitcoin is deflationary — in fact, it is truly unique among the world’s asset classes. De Beers manipulates the diamond market by sponging up liquidity to make it seem like diamonds are rare. They are, but not as much as De Beers and friends want you to know.”