Bitcoin Price and Inflation Perspectives: A Timely Assessment
Scroll DownOn June 17, Bitcoin prices took a slight dive from $38K down to $37,365 even though there are concerted efforts by wealthy investors to accumulate tokens and hope that the tide will turn in the direction of the $40,000 level. BTC was not the only trading commodity to go into a slump this months. Gold and other precious metals also pulled back not long after Jerome Powell, Chairman of the United States Federal Reserve Bank, stated that interest rates will likely start climbing very soon.
Inflation is definitely on the horizon for the American economy. Investors were hoping for a continuation of low interest rates when they heard about Powell's statements on the future of the federal funds target rate. The Fed has been lowering rates throughout the pandemic, but it appears to be set to to begin hiking rates this years. These rate increases should not happen any sooner than mid-September as Powell and the Federal Reserve believe price will increase further.
Investors are still skeptical about the price potential of Bitcoin and its potential to become more popular after former U.S. President Barack Obama hinted at his support for virtual currencies. With the market's volatility the stock market has shown some improvement in the past two weeks and investors could see a more normal level of interest once they adjust to normal currency flow.
BTC has risen to a record $38,085 today which makes it one of the largest investments in Asia. As the price remains somewhat inflated it may not be surprising to see the rally reverse as investors continue to ignore Powell's comments.
A new report by JP Morgan has revealed a major rise in Bitcoin purchases and selling in the last two weeks. JP Morgan found that BTC volume rose by more than 12%, a major increase from the previous week when the volume fell by less than 1%.
If the bitcoin market keeps climbing and the bitcoin mining community continues to increase, it could prove to be a game changer for a number of industries. Investors are looking forward to seeing new investment opportunities that cannot be found in fiat currency.
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