This Year, institutional investment has driven the price of Bitcoin. The main cryptocurrency has been the highest-performing macro asset in 2020.
for the first time since August, Bitcoin’s price overcame the psychological USD 12,000 barrier. Many would have expected a profit-taking correction from traders. However, Bitcoin has continued to climb to a high of USD 12,280.74, being the second time in 2020 that it has reached this level.
Data from CoinMarketCap indicate that the parent cryptocurrency is experiencing a slight reversal, trading at USD 12,175 per unit, at the time of writing this article. It has maintained a trading volume of USD 36,720,325,040 (equivalent to 3,015,961 BTC) in 24 hours. The highest trading volume (5.55%) has occurred against USDT on Estonian-based exchange EtherFlyer, preceding Australian-licensed exchange IDCM by 4.56%.
Bitcoin Has Been the Highest-Performing Asset in 2020
The year 2020 has been turbulent and uncertain, but Bitcoin has managed to do well. This year could go enter history books as the moment in which institutions started turning to Bitcoin as a refuge. Apart from MicroStrategy, who invested more than 38,000 BTC, other publicly traded companies including Square and Stone Ridge have seen the main cryptocurrency as a safeguard for their wealth.
London Stock Exchange listing company, Mode Global Holdings, announced that it will convert 10% of its treasury cash reserves into Bitcoin, which coincided with its price increase. For that reason, they stated that they will make “a significant purchase”. They said that they will do it as part of their “long-term strategy to protect their investors from the depreciation of their currency”.
“Amid the challenges of COVID-19 and the UK interest rate at its lowest in the Bank of England’s 326-year history (0.1%), our confidence in the long-term value of Bitcoin has only increased,” according to Jonathan Rowland, CEO of Mode. He also stated that they are seeking to maximize the value of their returns after their recent Initial Public Offering (IPO).
It is possible to see in Skew’s annual returns statistics that Bitcoin has been the highest-performing macro asset in 2020, with a 69.39% annual return. Gold, a traditional refuge of value, follows the first cryptocurrency with 25.69%. Concerning the US dollar, it shows negative figures when observing its average in the last month and quarter, despite presenting a 1.24% annual return.
The community is very optimistic about these figures, which seems to be driving the interest of investors. In agreement with that, Bitcoiner and analyst from cryptocurrency exchange Kraken, Pierre Rochard, stated that Square’s purchase of USD 50 million worth of Bitcoin will fall short. For that reason, they will eventually make greater panic purchases when they see the advance of inflation. They added that even AAPL “will also make panic purchases.”
Despite all this, there could be great uncertainty for all the markets as a result of the next elections in the United States. The outcome of the electoral event could shake prices in the short term, especially if the candidates use new issuance of economic stimulus as a campaign strategy.
For these, and other reasons, Bitcoin has proven to be the best option for those who want to venture into the cryptocurrency world.
By Willmen Blanco
