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Blog 14, Nov

Bitcoin and ethereum reach new heights

According to the website, on Tuesday, November 9, 2021, the value of the cryptocurrency market for the first time in history reached the level of $ 3 trillion. At the same time, bitcoin and ethereum have risen to new heights.
$ 68,692 is the current bitcoin price record set a few days ago. Its share in the total market reaches 43%, so it remains the undisputed number one among a wide range of more than 5,000 cryptocurrencies.
This should be seen as a result of long-term processes involving three main factors. The first - under the sign of technical analysis - concerns the almost two-year boom. Since the beginning of 2019, bitcoin has tended to grow, and the new peak in this perspective is the result of long-term dominance of demand. The second factor - under the sign of fundamental analysis - concerns the attraction of institutional investors. The ongoing boom is primarily due to large capital (Tesla, MicroStrategy, PayPay, Revolut, etc.), a specific symbol of which has recently been the approval of the US ETF for the supervision of bitcoin contracts. Finally, the third factor - macroeconomic in nature - is rising inflation.
The US CPI in October was released on Wednesday (6.2% vs. 5.8%), reaffirming the belief in the financial world that rapid prices are becoming a global problem. As bitcoin is considered digital gold, it is becoming increasingly valuable as a potential hedge against inflation.
The result of these three factors is the aforementioned bitcoin price records. The leader shows the direction to other cryptocurrencies, which, in turn, means that demand is also widespread among other cryptocurrencies. As a result, on Tuesday, the capitalization of the entire market for the first time reached about 3 trillion US dollars.
The question is what's next? The answer can be found in historical statistics, according to which November is the best month of the year for bitcoin. On average, it is growing by 51.1%, and so far the November issue of bitcoin is a modest 5.1%. To do this, we have the prospect of St. Nicholas, ie the effect of seasonal December growth (ie, generally increasing risk among investors), as well as rising inflation expectations.
In this context, the forecast for the end of the year looks optimistic, which, in turn, corresponds to the most well-known forecasting model used for the bitcoin market, ie Stock To Flow. According to his forecasts, this boom should last until the turn of 2021/2022, and the assessment of the analyzed cryptocurrency at the peak should have as many as six digits. It sounds incredible, but it's worth remembering that bitcoin was also incredible in overcoming the $ 1,000, $ 20,000, and $ 50,000 barriers.