In a positive news for Bitcoin users and investors, Bitcoin and Bitcoin Investment Trust (GBTC) seem to have left traditional investment instruments such as Gold, Stocks and government bonds in the dust. Bitcoin has had an upside of around 220.59% so far in 2017, tremendously higher than anything traditional investments can hope to match .
In comparison, the S&P 500 and SPDR Gold shares have only managed a single digit 6.13%. However, these returns seem realistic and stable versus the insane pumps witnessed in the crypto world. Bitcoin adoption and tax cuts in Asia-Pacific region in addition to the US Federal Reserve's monetary policies seems to have been one of the many factors leading to Bitcoin's recent rallies.
ICOs have drawn huge attention to the entire cryptocurrency sector where new projects and startups are raising millions of dollars in investment in mere seconds. Tech company stocks such are Tesla and Facebook have been unable to match Bitcoin's pace of growth in it's market cap.
From a report on Yahoo Finance:
Gaining Mainstream Use
Some of the top economies such as Korea, Japan and even India are considering many incredible things from their perspectives, in order to move towards mass adoption of Bitcoin and altcoins. Greater crypto adoption from emerging markets is likely to cause further increase in demand and upward swings in Bitcoin price.
Currency manipulations as we've seen in Venezuela and demonetisation witnessed in India have contributed to the rise in adoption of Bitcoin. Cryptos are becoming a new favourite amongst market speculators and investors previously focused only on traditional, relatively low-risk investments.
US hedge funds are also investing into Bitcoin to combat inflation caused by budgetary deficits. People are starting to consider various cryptos as excellent investment instruments to park their life savings. Did you know that you can also buy Gold using Bitcoin?
Potential Crypto Bubble Looming Over Us?
Remember, all this could ultimately be just a big bubble. But if you consider Bitcoin's history, many skeptics have been saying this over and over again at every Bitcoin market correction. It would be wise to consider the potential of a greater upside to it's price but even as we want Bitcoin to touch $5000 in a month, but it might take longer than that. So it's wise to set expectations realistically.
One must also remember that even Steem price rallied alongside Bitcoin and corrected with Bitcoin's price corrections. Bitcoin rallies and dumps has a direct effect on the entire crypto market cap.
As crypto investors, we must all be prepared with a contingency plan in the event of a cypto bubble burst. What are you doing to mitigate your risks and safeguard your crypto portfolio in the event of such a scenario?