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Answers to key questions to understand the recent behavior of Bitcoin

A question that we are frequently asked is what role do North American regulations play in this regard. The point is that having clear cryptocurrency regulations helps transparency and lower uncertainty. There are many who believe that an assertive regulatory framework in the industry would reduce the volatility of BTC and increase public confidence. Thus, with more predictability, investors are likely to increase in the long term and their adoption globally will grow more rapidly. This is what was seen in the US, and what impacted the valuation of BTC.

Other common queries are some like “What do you think about statements like those of Jamie Dimon, who called bitcoin ‘fool’s gold’, and others that point to a presumed bubble such as Gabriel Casillas and Michael Burry? They are not the first or the last to say things like that. There have been many resounding cases of figures who have then reformulated their position. Such is the case of Dimon that, despite his criticism, JPMorgan – an institution of which he has been president since 2005 to date – offers its clients cryptocurrency products, and Burry has recently said that he bought “Some tokens”.

Also, another question / hypothesis about the behavior of BTC is linked to institutional investments. Since the beginning of 2020, we could see the start of an adoption trend driven by the entry of large companies into the ecosystem. This beginning of a global trend naturally aroused the interest of many people because the investments of world-renowned institutions stimulate crypto adoption, provide support that generates confidence in people. Players like Tesla, Square, MicroStrategy, that even in a context of strong market downturn they decided to bet on bitcoin, which denotes that it was not a spontaneous decision, but rather a thoughtful financial strategy designed for the long term.

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To continue picking up community concerns, bitcoin’s new all-time highs come in a context where adoption is booming and we are still at an early stage. Recently a Chainlaysis report was published suggesting that the Crypto adoption grew more than 881% in the last year. As long as there is increasing demand and a limited supply of 21 million, it seems inevitable that the price will continue to rise.

With regard exclusively to Buenbit, we have noticed an increase in operations, a behavior that occurs in general when the market is bullish and, above all, when there are historical peaks, because news multiplies and naturally increases interest, new users are added and the number of operations grows. In addition, a direct consequence of this phenomenon is that, normally, when BTC, the most popular crypto, rises, others also rise behind, as happened with the new historical maximum of ether (ETH), standing at the u $ s4,800.

Finally, a few brief recommendations. Before investing in BTC it is essential to understand the basic concepts of its operation, remembering the importance of diversifying our investments in order to reduce the risk involved in betting on the profitability of a single asset. Always the best investment is to educate yourself, invest time in learning and not invest money in something that you do not know how it works. Especially when we talk about a volatile asset, that is why it is so important to understand its fundamentals in order to be able to stay updated later.

CEO of Buenbit.

Source From: Ambito

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