Bitcoin Hits $11k As Bull Market Hits Plateau
After surging to a seven-week high of $11,000, Bitcoin has reached a plateau and is now relatively flat. However, proponents of a cryptocurrency bull market see the currency rising in the coming months despite the recovery having seemingly run out of steam.
BTC closed the month at around $10,300 offering only marginal gains to January's $10,221 closing. However, seeing the big picture, the cryptocurrency's performance in February was spectacular considering it dropped to below $7,000 at the start of the month.
While the currency has flat after reaching its seven-day peak, many are confident that the graph will be on the move once again. Still, it's a long way from its peak of nearly $20,000 in December, not to mention the $50,000 mark many die-hard fans have been claiming for months.
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At this point, market changes aren't going to be enough for Bitcoin to make full recovery. Its hype-fuelled rise isn't about to repeat itself anytime soon which means price increases depend on the cryptocurrency gaining mainstream acceptance. Unfortunately, that's easier said than done.
BlackRock Global Chief Investment strategist Richard Turnill believes that while BTC might achieve wide use, the market is still far from mature enough for it to earn a place in a mainstream investment portfolio. The New York-based investment firm manages $6.288 trillion in assets and has been touted as "the world's largest shadow bank."
"Crypto markets are highly volatile, fragmented, largely unregulated, and come with unique liquidity and operational risks," wrote Turnill. "The volatility of the cryptocurrencies makes the gyrations in the U.S. equity market during the global financial crisis almost look placid."
Turnill added that cryptocurrency investments "should only be considered by those who can stomach potentially complete losses." One solution he did propose in order to attract mainstream companies is more regulation. However, given that the popularity of digital currencies stems from anonymity and laissez-faire transactions, such regulation will likely be met with opposition.
