As a cryptocurrency, Bitcoin is as volatile as ever. After reaching its record price in 2017, the next year followed a huge plunge panicking investors.
Bitcoin is regarded as the world’s most popular cryptocurrency hit the $10,000 milestone in Friday. This achievement is the first time in over a year. The next day on Saturday, it climbed to over $11,00. This surge in price makes its value to rise more than triple it was from its low at the end of 2018.
The digital currency’s turnaround offered hope that the worst is over.
When Bitcoin first crossed $10,000 in November 2017, it took just 18 days to hit its all-time high of nearly $20,000, before it came crashing down.
The June 2019 rebound is another story, as it came with less hype.
One of the reasons is because Bitcoin outperformed most traditional asset classes this year, with investors citing more institutional support for cryptocurrencies and the blockchain technology that underpins them.
These investors and huge corporations are playing a greater role, more than ever before.
While it's difficult to get details about how much cryptocurrency trading is done by individuals relative to professional investors, but in 2019, there are more institutional investors and hedge funds trading Bitcoin than in 2017.
They are also among the prominent players, too.
However, trading volumes in Bitcoin and other cryptocurrencies are far below their peak in late 2017, according to figures from data provider Bitcoinity. Back then, Bitcoin’s surge was driven by individual investors and overwhelmingly speculative sentiment.
This time, the surge was speculated to be much more reflective of true value.
Another reason for the surge is Facebook. When it revealed its own cryptocurrency called Libra.
Following Facebook's announcement of Libra, investors have been buying Bitcoin on the expectation that Libra is going to bring digital currencies to mainstream users, a goal that so far has eluded Bitcoin itself. Libra is seen as a potential Bitcoin competitor, which brings added legitimacy to the overall cryptocurrency market.
In short, the market is completely different that it was back then.