Bitcoin Price Soars, But Analysts Are Still Skeptical!
• Bitcoin has seen an increase in value following the banking crisis earlier this year.
• Despite the evidence of its success, some analysts remain unconvinced it is headed in the right direction.
• Analysts cite liquidity issues and a lack of new money moving into the asset as reasons for their skepticism.
Bitcoin Soars Following Bank Crisis
Bitcoin has surged in value since the worldwide banking crisis began earlier this year. It has risen exponentially, with its price now at around $28,000 per unit after dropping to a low of mid-$16K range in November 2021. This is despite criticism by crypto skeptics such as Molly White, who believes that Bitcoin isn’t headed in the right direction or doing as well as many of its supporters believe.
Analysts Are Skeptical
Many analysts are skeptical about Bitcoin’s future performance despite clear evidence that it is currently on an upward trajectory. Ed Moya from OANDA believes there isn’t enough new money coming into the space to be indicative of widespread interest and growth. Conor Ryder from Kaiko expresses similar doubts, citing liquidity issues rather than institutional investment as responsible for the upswing.
Origin Of Bitcoin
Bitcoin was first introduced in 2008 on Halloween via a whitepaper outlining its purpose – to provide an answer to financial crises such as those experienced during The Great Recession. Despite large amounts of hype surrounding its launch, adoption hasn’t been quite what was expected and growth remains slow compared to other assets within the cryptosphere.
Stablecoins To Bitcoin Flows
Moya also believes that there have only been small amounts of money flowing out of stablecoins into bitcoin – not enough to suggest widespread adoption or market confidence just yet. However, more people may turn towards digital assets once more due to mistrust towards centralized finance systems caused by recent bank failures like Silvergate, Silicon Valley Bank and Signature Bank crashing over the past few months.
Whilst bitcoin appears to be moving back up again after a difficult 2020-21 period, some analysts remain unconvinced that it is truly headed in the right direction or doing as well as many think it is given current market conditions and volatility levels within certain sectors such as centralized finance systems and stablecoins. Only time will tell if these doubts are unfounded or whether they will prove prophetic further down the line!