Bitcoin’s dramatic price gains over the last 24 hours have prompted cryptocurrency experts to predict a shift in market sentiment among investors and traders.
A 20 per cent rise in value to $5,082 (£3,900) on Tuesday morning came after months of stagnating prices for bitcoin and other major cryptocurrencies like ethereum and ripple.
Speaking to The Independent, several market analysts suggested this could signal more positive movement in the months ahead.
“There is a growing sense that bitcoin is back. I’m now calling that the market has bottomed and the so-called crypto winter has come to an end,” said Nigel Green, founder and chief executive of financial advisory firm deVere Group.
“I believe bitcoin will now move higher over the next few weeks and months, making steady gains for investors. As the largest cryptocurrency by market cap, this will have a positive impact on prices in the wider crypto sector… I think we could reasonably see the bitcoin price hitting $7,000 in the next few months.”
Other cryptocurrency experts have urged caution over the sudden price surge, given the notorious price volatility associated with bitcoin.
“Bitcoin has shown, once again, its trading resilience and a potential to shake off the ‘moderately bearish’ tag some analysts had put on it at the start of 2019,” said David Futter, a fintech partner at the law firm Ashurst.
“Nonetheless, substantial volatility remains in the crypto market generally, something which the increasing regulatory scrutiny from global governments is unlikely to dampen in the short term at least.”
Bitcoin is currently trading at its highest value since November 2018, though it is still a long way off its late 2017 peak of $20,000.
After its incredible price explosion 18 months ago bitcoin experienced a sudden price crash before months of steadily declining prices.
Bitcoin’s value has remained relatively stable in recent months, making its sudden price surge all the more notable.
It is not yet clear what caused the market turnaround but it comes as several major technology companies are taking steps to either develop their own cryptocurrency or integrate bitcoin into their existing platforms.
“Bitcoin could be about to turn back up again in a more meaningful way,” said Joel Kruger, a currency strategist at LMAX Exchange.
“At a time when central banks have exhausted themselves with the unprecedented printing of money to keep sentiment running high and the global economy afloat, over a decade after the crisis of 2008, it would seem a peer-to-peer decentralised currency, with limited suppply and an attractive technology that it rests on, could be a compelling alternative option.”