Bitcoin has surprised the market in recent days, surpassing the US$ 39 thousand mark, which corresponds to approximately R$ 200 thousand. As a result, the largest cryptocurrency in the world recovered in a big way and stirred up the market — and also social networks, since it attracted the attention of many people. But does that mean it’s time for everyone to buy?
In reality, the answer goes beyond a simple “yes” or “no”, since you need to look at the whole — we need to look at the forest (market) and not just the leaf (bitcoin) — to understand which factors “made the price” of this asset. Like all financial products, traditional or not, bitcoin has its peculiarities and complexities, requiring in-depth analysis before making a buy or sell decision.
High in searches for ‘bitcoin’ and Amazon
To start this analysis, we can see that searches for the term “bitcoin” on Google Trends Brazil jumped 115% between the 19th and 26th of July, after the first publications of the market movement. So, for even more clarity, it is worth looking at the sequence of facts and drawing a logical reasoning to help those who are interested in this market to learn how to see such movements and make assertive choices.
First, the spurt was anchored by rumors that Amazon was considering starting to accept payments via bitcoin by the end of this year, news that quickly reverberated around the world. However, it would be a superficial explanation to say that this was the main driving force in the market, since we know that this is a market full of particularities.
In addition, the news was denied by the company itself a short time later — which did not cause the price of bitcoin to fall. This is a fact that proves that a single factor is not enough to compose a possible fall or rise in the asset. Therefore, Bitso recommends caution when buying cryptocurrencies based on information without credible and transparent sources.
A price rise like the one we saw last week usually comes from the willingness of the market to pay for something, but when it comes to a cryptocurrency, it’s important to consider value, which is a much broader factor.
How to identify these trends and know if they will last? At Bitso, the main guideline for those who want to enter the world of cryptocurrencies is to stay informed to understand what can impact this universe and, thus, make your own decisions, regardless of the information that comes out every day.
market is for everyone
At this point, one of the most interesting things is that, unlike other markets, information from the crypto world is accessible to everyone — transparency is one of the main pillars of this ecosystem, which brings unique technologies that allow this, such as the Blockchain, along with a possibility of a different future for the uses of money.
Looking at the Brazilian scenario, in which 30% of the population is debanked according to World Bank data, more than a momentary bet, it is possible to see in serious cryptocurrencies, such as bitcoin or stable currencies, an alternative to a reserve of value.
Access to cryptocurrencies, unlike what happens in regular banks, is possible for everyone outside the traditional financial system. For us, at Bitso, the most important thing is to offer users the best experience on the platform, providing security and autonomy when identifying market opportunities.
Extremely volatile market
In summary, we can state that an abrupt rise or fall in price is composed of several factors, as in other markets, and prudence when trading cryptocurrency is essential.
Take time to understand how this market works and what are the main movements that can impact it. Seek information from reliable sources and always stay tuned, as the cryptocurrency market is extremely volatile and constantly changing.
Those who stay informed are able to make their own decisions about what to buy or sell consciously and in line with their expectations.
About the author
Abraham Cobos is specialist and leader in Bitso cryptocurrency studies