Bitcoin Surges To Two-Year High As Supply Seen Shrinking In July
Let’s start with the difference between Bitcoin and Blockchain. Former is a digital currency system that would allow people to create and send bitcoin by using Blockchain. Blockchain is the platform where BTC is created. Bitcoin basically describes the market forces of demand and supply; it is also based on speculation.
As supply of digital currency are seen shrinking, Bitcoin surges to a two year high. According to the data by Bloomberg, crypto currency has picked up to $720.77; this was recorded as the highest since 2014.
Jack C. Liu, who is the chief strategy officer at OKCoin, said that banks and venture capitalists are now focusing on Blockchain; the halving of its supply would attract retail investors. We can see that Blockchain hype cycle converted interest in Bitcoins.
The pick-up of Bitcoin is colliding with weakness in Yuan. In the recent weeks, many losses have occurred with dollar strengthening and the economic outlook of China worsened. In the first few months of this year, fixed asset investment has increased up to 9.6% and industrial output has increased to 6%. The Yuan weakening and Chinese economy slowing down, both would trigger capital outflows outside of China and there are chances of one-off devaluation. This would be the winning end for Bitcoins.
Among the ninety-three global stock indices, Shanghai composite index is the worst performer of the year.
Bitcoin was coined in 2008 and was created by Satoshi Nakamoto who was a programmer. A network of volunteers has worked on this, they basically validate transactions through their computers and all of them require electronic signatures. In doing so, they also earn money based on market process.
According to one of the industry researchers, CoinDesk venture capital investments for Blockchain have reached $1.1Billion. In 2015, United States Commodity Futures Trading Commission has categorized bitcoins as a commodity.
The founder Huobi, Li Lin said that the reduction in the productions would increase the expectations. Now the use of bitcoin is very common and it is also helping in improving the development of a favorable environment.