Bitcoin (BTC) is once again nearing the all-important $4,000 threshold, a significant bounce-back compared to last week’s low point of $3,200 that came as a result of China’s crackdown on initial coin offerings (ICO).
Of course, the brightest cryptocurrency future has to include the Chinese market and its loads of cash, but for now, Bitcoin should be able to pull itself up steadily back to the $5,000 mark without China’s help.
Cryptocurrencies will need to find a way to reintegrate themselves into the Chinese market in the long term. BTC prices benefit from a surge in the industry as a whole—at least for now, because no other cryptocurrency yet comes close to challenging Bitcoin’s dominance, making competition a very distant afterthought.
China will have to shift its stance eventually, however, if Bitcoin and cryptocurrencies carve out a significant enough position of power within the market. Bitcoin will simply become too big to be ignored, and China will have to relax or at the very least alter its policies in order to adjust to that new reality.
Another interesting development in the Bitcoin market is a new study that shows a 91% correlation between the current price of Bitcoin and the volume of Google search requests, according to a study by SEMrush, a search engine marketing agency. (Source: “The price of bitcoin has a 91% correlation with Google searches,” Business Insider, September 19, 2017.)
While not particularly shocking, it does go to show that Bitcoin is gaining peak notoriety, with people normally uninterested in investing in traditional assets now becoming interested in Bitcoin, probably due to its meteoric rise. After all, it’s hard to discount BTC’s hundreds of percentage points worth of gains over the past year.
China will return to the fold one day, but before then, Bitcoin should have no problem achieving the gains we’ve come to expect from the cryptocurrency.
While losing access to the Chinese market did hurt the industry overall, Bitcoin has enough alternate avenues for expansion that it needn’t worry about China—yet.
And as we’ve come to expect with Bitcoin, after each massive price cut, an equally massive rally is usually in store. I expect BTC price to be above $4,500 before the end of September, barring any further unforeseen developments.
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