Virtual currency Bitcoin’s total transactions value may surge from less than $27 billion (2015) to over $92 billion this year, reported a new study from Juniper Research. Bitcoin is now trading at values almost 50% higher than at the beginning of the year and the research found that transaction volumes will continue to be concentrated overwhelmingly on the exchanges. Two recent reports look to shed some light on the subject that retains its enduring mystery despite authorities attempts to bring it to heel:
Earlier, the Future of Cryptocurrency – Deep Dive Data & Forecasting 2016-2021 said in a research report that the surge in the value of currency may be attributed to 3 factors:
* Brexit: The research argued that Bitcoin’s value is to a significant extent dependent upon economic uncertainty and political instability as investors seek safe havens for their assets. Bitcoin’s price rose in the weeks leading up to the referendum, dipped briefly but sharply when it appeared that Britain would vote to remain in the EU, before recovering when the true result became apparent.
* Weakness of the Chinese economy: The overwhelming majority of Bitcoin trading occurs on Chinese exchanges, while the continued weakness of the Chinese economy has seen investors using bitcoin as a haven against expectations of a further fall in the value of the yuan.
* Reduction in money supply: The imminent ‘halvening’ whereby the amount of Bitcoin being introduced by mining in a set time period will halve is also pushing its price upwards.
Then there is the the possibility of a Donald Trump Presidency.
According to Windsor Holden, the author of the research, concerns around the prospects of a Trump Presidency in the US were also likely to cause further spikes in trading and Bitcoin value later in the year.
“If Donald Trump becomes President of the US, there is the very real prospect of turmoil on world markets – the Economist Intelligence Unit ranks his Presidency within the Top 10 global risks,” he said. However, Bitcoin trading would thrive in such an environment, at least until the impact on major fiat currencies becomes clear,” said Windsor.
The research also stated that bitcoin’s adoption in the retail space was likely to remain limited to a niche audience as only a small number of websites seeking to offer it as a payment option.