The year 2018 and 2019 have been full of changes and decisions made by governments that have left the markets fluctuating in ways we could never imagine. These changes have caused the rise and fall in the cryptocurrency world, especially for Bitcoin.
Here are 9 reasons why the coming time will be the biggest bull run for Bitcoin.
1. Tariffs and Trade Wars
The U.S. and China tariff war moved on to a trade war, and now things are getting out of hands for both the countries. Last week Trump threatened to impose new 10 percent tariffs on Chinese goods worth 300 billion from 1st September.
This has been causing stress between both the countries on their terms of trading and the way exports are done. This trade war might force China to consider shifting to cryptocurrency to avoid dealing with the U.S.
2. CNY Devaluation
The trade war between the U.S. and China has taken an ugly turn on Monday, where Beijing allowed their currency to weaken. This escalation has shaken the investors, and they are finding places to park their money safely.
Due to this, the Asian stocks started at a very low rate, but slowly, they got better during the day time.
3. USD Strength Hurting Emerging Market Currencies
Whenever the Federal Reserve decides to normalize the interest rates, it will have a huge impact on the U.S. as well as the rest of the world. If the investment returns to the U.S., the capital flows away from the emerging markets will accelerate and make the funding more difficult.
Rising rates will present challenges to the emerging markets, especially to those that are dependent on external financial sources, companies, and banks with large amounts of dollar-denominated debt that will become more expensive.
4. Trust In Central Banks Lost
Banking services have been with us for years, but recently they have been victims of cyberattacks which causes problems like data being stolen from the servers to be used for scams or to compromise the banking security system.
This has to lead to people losing their faith in banks, and they are finding ways to keep their money in places where it can be considered safe and away from the centralized system. Bitcoin is the top choice of people for investing their money in.
5. Stocks Falling
Bitcoin has been hitting highs and lows this year, and with the recent trade wars between the U.S. and China, the bitcoin price charts have seen a constant rise in the charts. This shows that the fluctuation in stocks and the falling of stocks can lead to the rising of Bitcoin.
People have considered shifting to Bitcoin, and other cryptocurrencies as the market crashes had to lead to a fall in the stocks.
6. Negative Yielding Debt Rising
The bonds are investments made by people that are provided at a certain interest rate, and once they get mature, the holder receives the money. But in cases of bonds with negative-yielding, the investor has to face a loss on his investments if he holds it till the time it gets mature. The borrowers are getting paid to issue debt as they pay less than the face value of the loans.
7. Crypto Custody and Insurance
Cryptocurrencies are being used at a faster rate, and people are moving to digital currencies. To help and support this move, the world’s second-largest insurance broker by revenues firm, Aon has decided to provide cryptocurrency coverage for clients.
This scheme will provide cover for the loss or destruction of private keys kept offline through natural disaster to third-party hacks of hot wallets that are connected to the internet.
Halving in Bitcoin is referred to the time when the number of Bitcoin generated by miners is cut into half after every ten minutes. This reduction in half decides the reward to be given to the miners. Right now the reward is set at 12.5, and in a year it’ll get reduced to half making it 6.25 coins.
9. Brexit/EU Tension
U.K.’s decision of leaving the European Union is known as the Brexit deal. This decision took place in 2016 through voting. Britain somehow managed to avoid crashing out without a deal by extending the negotiation period twice.
Britain is allowed to leave the EU by 31st October if it wishes to whether there is a deal or not. The Brexit bill is the financial settlement of the debt that the U.K. owes Brussels following its withdrawal. It is said that the estimated amount is somewhere close to £39 billion.