Three Reasons Bitcoin Just Hit New 2020 High of $18,700

Opinions
Fri, 11/20/2020 - 15:23
article image
Alex Dovbnya
Bolstered by Ethereum's rally and gold's recovery, Bitcoin has surged to a new yearly high of $18,737
Three Reasons Bitcoin Just Hit New 2020 High of $18,700
Cover image via stock.adobe.com
Contents

Bitcoin rocketed to a new 2020 high of $18,737 at 3:05 p.m. UTC on the Bitstamp exchange, its highest level since Dec. 19, 2017.
   
The cryptocurrency is less than five percent away from its lifetime high of $19,664 that was set on Dec. 17, 2019.

BTC
Image by tradingview.com

Institutional engagement

In a Nov. 20 interview with Yahoo! Finance, Fundstrat's Tom Lee says that the cryptocurrency "thrives off" its network value.

The permabull claims that institutional adoption is "really taking off" in the U.S.:

We've seen a lot of interest and a lot of engagement.

This trend can also be seen across the pond. Switzerland-based cryptocurrency ETP manager 21Shares is now raking in $3 mln worth of inflows from institutional investors on a daily basis. Last year, it could not scrape this sum together in a whole year. 

The halvening narrative and gold's recovery

Lee is convinced that the May halvening is also a key factor behind the ongoing uptrend because it has dramatically reduced the supply of the cryptocurrency:

It's killing it this year. It's crushing all other hedges and other classes.

Because of how scarce Bitcoin is, it is often called "digital gold." After ranging below the $18,400 resistance level, the cryptocurrency ended up smashing it by following the lead of the yellow metal. Spot gold is currently changing hands at $1,876.

Related BlackRock CIO: "Bitcoin Is Here to Stay"
Related
BlackRock CIO: "Bitcoin Is Here to Stay"

Ethereum leads the rally

Whether Bitcoin maximalists want to admit it or not, the most recent Bitcoin uptick was foreshadowed by Ethereum.

Earlier today, the flagship altcoin crossed the psychological level of $500 for the first time since June 2018.

Multiple DeFi tokens are also on a roll today, with DeFi tokens such as Curve DAO Token (CRV) and SushiSwap (SUSHI) posting double-digit gains.

article image
About the author

Alex Dovbnya (aka AlexMorris) is a cryptocurrency expert, trader and journalist with extensive experience of covering everything related to the burgeoning industry — from price analysis to Blockchain disruption. Alex authored more than 1,000 stories for U.Today, CryptoComes and other fintech media outlets. He’s particularly interested in regulatory trends around the globe that are shaping the future of digital assets, can be contacted at alex.dovbnya@u.today.