With the jump over $14,000, Bitcoin reaches its highest level since January 2018.
The Bitcoin share price (BTC) broke the US$14,000 mark on October 31, the date on which Bitcoin’s white paper was published under the pseudonym Satoshi Nakamoto twelve years ago. Since then, the market-leading crypto currency has made considerable progress in many areas.
Twelve years after its launch on 31 October 2008, Bitcoin is in a completely different dimension. The entry of institutional investors into the market is currently fuelling BTC’s recovery, several major financial institutions are now working with crypto-currencies and, in addition, the liquidity of the market continues to increase.
Halving coincides with my birthday
The twelfth „birthday“ of the Bitcoin white paper has a very special meaning, as this year also saw the third „halving“ of Bitcoin.
Every four years, the market-leading crypto currency undergoes a so-called „halving“, which literally halves the block reward, and thus the rate of increase in the volume in circulation. This mechanism is built-in, as the total amount in circulation is limited to 21 million BTC. The closer Bitcoin comes to this upper limit, the lower the rate of increase or the amount of new units added.
As halving therefore reduces the available supply, this event has always had a positive effect on the price development so far. Every four years, the crypto currency therefore undergoes an automatic shortage.
Accordingly, the fourth, eighth and twelfth birthdays of Bitcoin Bonanza are each more important than all the years in between. The last halving of this kind was held in May 2020, which makes today’s „celebrations“ all the more interesting.
On the whitepaper’s birthday Bitcoin has almost always seen a significant jump from the previous year, for example BTC in 2013 was only 204 US dollars, whereas in 2014 it was already 338 US dollars. In 2015 it dropped to 314 US dollars, but by 2016 the rate had more than doubled to 700 US dollars. While in 2017 the exchange rate even jumped to 6468 US dollars, in 2019 it was 9,199 US dollars again.
Only just over 14,000 US dollars
And this trend seems to be repeating today, as Bitcoin has meanwhile climbed to a high of 14,100 US dollars on the major crypto exchanges. Selling pressure then came back into play at this level, mainly from the Binance, which then lowered the price again by 3 %.
Prior to this decline, Bitcoin was pushed up by massive buy-walls on Huobi and Binance. Binance, for example, had a buy-wall of BTC 1,371 at $13,680, before a second buy-wall on Huobi at $13,800 strengthened the upswing.
A Bitcoin trader on Twitter says that this is „the biggest buy wall on Huobi“ he has seen in a long time.
However, when Bitcoin was then lifted above the $14,000 mark, traders on Binance quickly sold large amounts of BTC again. Cointelegrahp Markets expert Keith Wareing had already feared a similar development in the run-up to this:
„Unfortunately, Bitcoin will be knocked off at the $14,000 mark by the major investors in Binance and pushed back below the 2019 high.
What comes next?
After such enormous price swings, Bitcoin usually stabilises and settles in a sideways movement. Since the $14,000 mark is an important resistance, it can be assumed that the crypto currency will initially strengthen below this hurdle and repeatedly jump above it.
The market researchers at CryptoQuant recently pointed out that the Bitcoin assets stored on crypto exchanges are becoming less and less. This mostly indicates a decreasing pressure to sell.
Ki Young Ju, CEO of CryptoQuant, concludes that this development is „a long-term buy signal“. The fewer investors want to sell, the greater the likelihood that a long-term uptrend is imminent.
So, an optimistic mood, underpinned by strong fundamentals and several positive technical indicators, is giving Bitcoin a happy 12th birthday.