3 reasons Bitcoin could hit the $ 40,000 mark again

Bitcoin is facing strong selling pressure this Thursday as its price has fallen another 1.5 percent.

The benchmark cryptocurrency touched an intraday low of $ 34,200 and hit a higher high after falling below the all-important $ 34,000 support level in the previous session.

Its fall appeared primarily due to profit-taking among traders and investors, especially after the price crossed the $ 38-000-40,000 range on more than two occasions.

As CryptoQuant CEO Ki-Young Ju comments, spot inflows into cryptocurrency exchanges cooled this week, suggesting a longer downward correction in the future.

„$ 35,684 -> $ 34,054, and I expect more,“ said Ju. „BTC OG whales are strong when there are no spot inflows.“

Nonetheless, the long-term bullish fundamentals are abundant this week, giving Bitcoin Profit ammo to continue its bullish run. So why could the cryptocurrency hit $ 40,000 again? Here are three reasons:

# 1 Blackrock announcement

BlackRock, one of the world’s leading investment firms, has filed documents with the US Securities and Exchange Commission seeking to introduce cash-settled Bitcoin futures for two of its funds: the BlackRock Global Allocation Fund and the BlackRock Strategic Income Opportunities Portfolio.

While the announcement is no guarantee that BlackRock will launch a Bitcoin-enabled futures investment service, it does underscore a drastic change in the New York-based $ 7.4 trillion firm’s tone on cryptocurrencies in general. In 2017, BlackRock CEO Larry Fink called Bitcoin the „money laundering index“.

But their recent inclusion of Bitcoin in their SEC filings shows a different take on the cryptocurrency. It confirms the growth of the cryptocurrency as a mainstream financial asset, on par with its top hedge rival, gold.

# 2 Grayscales Bitcoin Accumulation

Grayscale, the world’s largest crypto investment firm, bought an additional $ 600 million worth of bitcoin after pausing its wave of accumulation for more than a week.

Data provided by ByBt.com shows that the New York firm added 16,244 BTC to their vault, bringing total reserves to more than 630,000 BTC, valued at nearly $ 23 billion.

Analysts see Grayscale’s wave of accumulation in the new year as a signal for another price rally.

“Grayscale bought more than 8,000 Bitcoin,” explains Clark Davis, a crypto YouTuber. “If they did this every day they would buy 2.9 million BTC this year. There are only 2 million on exchanges. There is no scenario where the price won’t go much higher with this insane demand. „

Bitcoin is now worth more than a 20-ounce gold bar

Bitcoin is now worth more than a 20-ounce gold bar

Now that Bitcoin has passed $40,000, a single BTC is worth more than a 20-ounce gold bar – how much more will it grow?

Bitcoin’s impressive growth shows no signs of slowing down: its latest All-Time High has sent the asset’s price soaring beyond the value of a 20-ounce gold bar.

According to TradingView.com, BTC has surpassed $41,000 in the past few hours

The asset has been unstable for the past few days, but so far there has been no collapse that would jeopardize the continued appreciation of the dominant crypto.

Experts in the field often refer to Bitcoin as „digital gold“, as it is an asset with many of the characteristics of a Crypto Engine store of value, much like precious metal. At the time of writing, gold is trading for $1,890 an ounce according to Goldprice.org. In other words, a 20-ounce bar is worth about $37,800.

„It now takes more than a 20-ounce gold bar to buy a single #Bitcoin.“

It now takes more than an entire, 20 ounce, gold bar to buy a single #Bitcoin pic.twitter.com/B8YsAgyRJL
– Documenting Bitcoin (@DocumentBitcoin) January 7, 2021

DigiByte Foundation secretary and vice president Rudy Bouwman said:

„Bitcoin will become like gold bullion, it will just be a store of value.“

This rally is slightly different from that of 2017, in that it is mainly driven by institutions that, unlike retail investors, tend to hold the asset for the long term rather than selling it to make a profit in the short term. This behaviour further reinforces the idea that Bitcoin is a store of value, making it more comparable to gold than ever before.

In terms of performance, over the past 12 months Bitcoin has achieved a massive 378% growth, while gold only managed to gain 21.6% over the same period.

Moreover, Bitcoin is still chasing new all-time highs, while gold prices have fallen 7.6% from their peak of $2,070/ounce on 6 August 2020.

Peter Schiff, a notoriously sceptical of BTC, finally admitted that Bitcoin is in fact taking market share away from gold:

„Bitcoin is actually sucking some of the demand out of gold, which makes the Fed governors extremely happy. Rising gold prices are what central bankers fear most. Bitcoin is their best friend, which may explain why regulators are in no hurry to burst the bubble.“

With the price of a single Bitcoin now higher than that of a gold bar, the question remains: how much higher can it go?

A Star is Born – Bitcoin more popular than ever on social media

With the new record run, Bitcoin is back in the social media spotlight as well.

New analytics data for Twitter shows that interest in Bitcoin on the social network is also hitting new record highs, after the price of the market-leading cryptocurrency has now climbed well above $30,000.

In a related tweet on Saturday, crypto market researchers at The TIE reveal that the number of unique Twitter accounts posting about Bitcoin Revolution has reached a new high. This even trumped the previous record high of 64,000 accounts set during the record-breaking 2017/2018 run:

Joshua Frank, CEO of The TIE, reports to Cointelegraph even more information that suggests interest is growing, and it’s not just limited to bitcoin.

According to Frank, the number of unique accounts posting about bitcoin has actually jumped above the 70,000 mark for the first time since The TIE’s tweet. Also, the total tweet volume for Bitcoin has simultaneously pulverized the previous record set in December 2017, which was 135,000 tweets per day, by now reaching 140,000 Bitcoin tweets within 24 hours. As a result, the number of total crypto tweets has also hit a new record high, as it were, at a quarter of a million per day.

The increased interest is not unique to Twitter, however. As Cointelegraph had previously reported, the number of Google searches for Bitcoin is also increasing.

Accordingly, the search query „How do I buy Bitcoin?“ is also gaining significant popularity.

Similar searches for Ethereum, on the other hand, fail to register such an increase, although the second-ranked cryptocurrency has gained 20% in the last 24 hours.

Some voices speculate that the ongoing climb is due to „gate-crashing panic“ among institutional investors, which means that retail investors are now also falling into the so-called „Fear-Of-Missing-Out“ (FOMO).

A new tweet from blockchain company Dash has drawn criticism, as the associated cryptocurrency, previously promoted for its focus on anonymity and privacy, now emphasizes that it is similarly transparent to Bitcoin.