It is the first time when bitcoin exceeded the threshold of $2,000, enjoying rising trader interest.
The currency’s price rose as much as 2.62% during the session, according to CoinDesk’s Bitcoin Price Index (BPI) to hit a press time high of $2,019. By rising above $2,000, bitcoin’s price has surged more than 100% this year and nearly 125% since hitting an annual low of $891.51 in late March.
Now that the the digital currency has surpassed this key, psychological level of $2,000, it could experience some significant tailwinds, according to several analysts who spoke with CoinDesk.
Arthur Hayes, co-founder and CEO of leveraged digital currency platform BitMEX, told CoinDesk that should bitcoin prices “convincingly” surpass $2,000, “the rate of price appreciation will accelerate dramatically”.
Charles Hayter, co-founder and CEO of CryptoCompare, also weighed in on the importance of this price level, stating:
“As a psychological level, bitcoin hitting $2,000 is an important milestone and will generate further interest that could boost the price further.”
Speaking of interest, analysts generally agreed that bitcoin’s rise above $2,000 could spur significant attention from the media. Hayes offered similar sentiment, stating that a sustained rise above $2,000 would prompt every major financial media outlet to cover bitcoin.
In spite of all this visibility, Hayter cautioned that sometimes, the “lack of sophistication” that goes along with mainstream media coverage “can be dangerous as it snowballs momentum.”
Interestingly enough, Google Trends data has thus far shown that online searches for the word “bitcoin” have still not recovered to the all-time high they set in December 2013, but they are getting closer. While a figure of 100 represents the highest point for these searches, the metric stood at 85 at the time of report.
While many agreed that bitcoin’s rise above $2,000 would spur greater media coverage, the factors that drove the currency’s price above this level seemed a bit more complex.
One development that has coincided with bitcoin’s sharp price gains over the last several months is the rising interest of traders, as measured by trading volume at major exchanges. Earlier this month, both Kraken and Poloniex announced that they were experiencing surging transaction activity.
Kraken indicated that on 5th May, trading volume across all digital assets surpassed $178m, setting an all-time high and beating the prior record by 25%.
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