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Bitcoin up and why it could go higher

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From February to April 2019, the price of Bitcoin has risen from around $3500 to over $5000. Other cryptos have been doing well too, with the combined market cap of cryptocurrencies rising to $186 billion this week, although Bitcoin accounts for around half that figure.

The financial media will often give compelling, yet contradictive, messages to readers, causing a rush to buy and sell Bitcoin, but there seems to be tangible evidence that the original cryptocurrency could go higher. 2018 was perhaps the annus horribilis for Bitcoin, but there seems to be a swirl of optimism over the last few weeks.

First of all, there are hopes for institutional adoption to be accelerated in the near future. As popular crypto analyst, Alex Kruger, put it on Twitter last week, “Bitcoin. Institutional money is here.” It’s a reference to the new money pouring into cryptocurrencies from institutions.

Some predict all-time high is in sight

Going further, Brian Kelly said on CNBC’s Fast Money that institutional adoption, alongside a growth in R&D (more on that below) would “without question” push Bitcoin back over that famous $20,000 high achieved in December 2017 in the next couple of years. That’s an incredible vote of confidence, given within an acute timeframe.

In a way, institutional adoption has always been the great hope and fear for Bitcoin investors. While it’s almost entirely positive when traditional financial institutions climb on board, whether that’s through investment or offering cryptocurrency on their platforms, proponents of cryptos will also worry that mainstreaming them could lead to too much regulation. Still, if mainstream institutions, including whales, are pouring money into Bitcoin and other cryptos, that’s exciting for current investors.

The other aspect driving a certain sense of optimism in the crypto market is the explosion in the number based in research and development. The number of developers working on public coin projects has said to have almost doubled from around 2,200 in January 2017 to well over 4,000 today. That may not seem like a significant amount, but it could have huge impact in the world of cryptocurrency.

Still unknowns, but analysts are bullish

What does this mean for the price of Bitcoin and other cryptocurrencies? Studies have shown a correlation between crypto development activity and positive weekly returns. Crucially for those investing in Bitcoin, the number of developers has remained strong, whereas other, less well-known, cryptocurrencies have seen the number of developers tumble, killing the activity.

Of course, nobody can guarantee that the likes of Kruger and Kelly will definitely be proven right in the coming couple of years. However, there is certainly a sense of confidence emanating from those in involved in cryptocurrency investment.

For the moment, those who bought Bitcoin just last month are basking in the huge returns made on the cryptocurrency in just a few weeks. Will we match those heady days of December 2017 once again? It remains to be seen, but things are looking up.

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